7. If the MPS is .25 and the current GDP is $180,000 and the target level of GDP is $160,000, what change in Government Spending is required to reach the target?

8. If the MPS is .67 and the current GDP is $150,000 and the target level of GDP is $210,000, what change in Government Spending is required to reach the target?

9. If the MPS is .20 and the current GDP is $150,000 and the target level of GDP is $175,000 what change in taxes would be required to reach the target?

10. If the MPS is .90 and the current GDP is $160,000 and the target level of GDP is $130,000 what change in taxes would be required to reach the target?

Answer rating: 100% (QA)

To calculate the change in government spending or taxes required to reach the target GDP we need to use the concept of the expenditure multiplier and ... View the full answer