Question: The MPC = 0 . 9 . A 1 0 0 b increase in Government Spending resulted in a 1 , 0 0 0 b

The MPC =0.9. A 100b increase in Government Spending resulted in a 1,000b increase in GDP. This result indicates that
here was no inflation and GDP increased by the full multiplier amount
inflation reduced the value of the multiplier
None of these answers is correct
deflation reduced the value of the multiplier
inflation increased the value of the multiplier

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Economics Questions!

Q:

the E question have been solved but F is a little bit difecult to me. all question are solved except F. F. If population is about 10 million people, how much would be the increase in GDP per capita...

Q:

Measuring Business Cycle Fluctuations: Answer parts A, B, C & D accordingly. (A) (3 points) Given data on GDP, capital and labor, and a production function F(K, L), explain how you would calculate...

Q:

QUESTION 4 0.5 points Save Answer If the government wishes to increase GDP by $1,200b, and the MPC is 0.75, it should: O increase its spending by $300b. O B. decrease its spending by $300b. O C....

Q:

ur email will be recorded when you submit this form If inflation were caused by a sudden increase in aggregate demand, then: 1 point real GDP would always increase. it would be costless because it...

Q:

Question 1 Which of the following best represents the savings function? Group of answer choices Savings = Autonomous Consumption + marginal propensity to save x disposable income Savings = Autonomous...

Q:

Question one. 1. The following table shows the quantities of corn supplied and demanded at different prices. Price per Ton Quantity Supplied Quantity Demanded $80 700 1,200 85 800 1,100 90 900 900 95...

Q:

From Table 2 Collect for Jun-1975 to Jun-2020: General government ; Final consumption expenditure: Chain volume measures ; G Households ; Final consumption expenditure: Chain volume measures ; C...

Q:

Q2.Find the Australian Bureau of Statistics ABS 5204.0 Australian System of National Accounts 2019-20 on the internet, on the "Data Download" tab. click the link to download the MS Excel spreadsheet...

Q:

MC Qu. 31-113 (Algo) Suppose the economy's multiplier is... Suppose the economy's multiplier is 4. Other things equal, a $25 billion decrease in government expenditures on national defense will cause...

Q:

MC Qu. 31-113 (Algo) Suppose the economy's multiplier is... Suppose the economy's multiplier is 4. Other things equal, a $25 billion decrease in government expenditures on national defense will cause...

Q:

Write a short note on topic Standard and Poor's 500 related to mutual fund.

Q:

Martha Shine owned the following in 2020 2 Rental Properties (Property 1: land $70,000, building $55,000) (Property 2 land $90,000, building $60,000) -Net rental income before CCA was $11,000 The...

Q:

Company: Munahbor tese the followine news article and antwer the Multigle Cholce quentions below. All of us tiae to munch, and one man has actually made that into his buniness by launctires Munchbon....

Q:

Refer to the article in the text titled "Indigenous Environmental Perspectives: A North American Primer" by Winona LaDuke and answer all parts of the following questions (a) What have been the...