a. What is the marginal propensity to consume implicit in these data? b. Plot a 45° line,
Question:
b. Plot a 45° line, and then use the data to draw an aggregate expenditure line.
c. What is the equilibrium level of real GDP? Illustrate it on your diagram.
d. Suppose that investment spending increased by 250 at each level of income. What would happen to equilibrium GDP?
Transcribed Image Text:
Real GDP C NX 3,000 4,000 5,000 6,000 7,000 8,000 2,500 3,250 4,000 4,750 5,500 6,250 300 500 200 300 500 200 300 500 500 200 200 300 300 500 200 300 500 200 of
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a The MPC is 075 because each 1000unit increase in Y results in 750unit incre...View the full answer
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Related Book For
Macroeconomics Principles and Applications
ISBN: 978-1111822354
6th edition
Authors: Robert E. Hall, Marc Lieberman
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