Question: 1) If the marginal propensity to save (MPS) is equal to 0.1, the government will be able to shift the aggregate demand curve to

1) If the marginal propensity to save (MPS) is equal to 0.1,

1) If the marginal propensity to save (MPS) is equal to 0.1, the government will be able to shift the aggregate demand curve to the right by $40 billion if: a.increases government spending by $40 billion. b.increases taxes by $4 billion. c.reduces taxes by $4 billion. d.increases government spending by $4 billion. 2) Interest payments on public debt: a.it has no effect on income distribution. b.increases the standard of living of the inhabitants of a country. c.can reduce income inequality. d.can increase income inequality.

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