Question: Consider a demand-determined model, with a marginal propensity to consume of 0.80, a marginal propensity to import of 0.30 and a tax rate of 0.25.

Consider a demand-determined model, with a marginal propensity to consume of 0.80, a marginal propensity to import of 0.30 and a tax rate of 0.25. How much of an increase in economic activity would be generated by a $240 million increase in government spending? (Answers in millions, with no dollar sign - ie. $125,500,000 represented as 125.5)

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