5. Suppose Bard is its own marginal propensity to consume at Bard is 0.5. Autonomous consumption at Bard is $200. Government spending is $100. Intended investment is $100. ing full employment. The a) Calculate the spending multiplier at Bard. Calculate the tax multiplier. Why is the tax multiplier small than the spending multiplier? 00.0 b) Calculate and show graphically equilibrium output and income at Bard
5. Suppose Bard is its own marginal propensity to consume at Bard is 0.5. Autonomous consumption at Bard is $200. Government spending is $100. Intended investment is $100. ing full employment. The a) Calculate the spending multiplier at Bard. Calculate the tax multiplier. Why is the tax multiplier small than the spending multiplier? 00.0 b) Calculate and show graphically equilibrium output and income at Bard
Chapter11: Managing Aggregate Demand: Fiscal Policy
Section11.A: Graphical Treatment Of Taxes And Fiscal Policy
Problem 3TY
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Transcribed Image Text:5. Suppose Bard is its own macroeconomy functioning at full employment. The
marginal propensity to consume at Bard is 0.5. Autonomous consumption at Bard
is $200. Government spending is $100. Intended investment is $100.
a) Calculate the spending multiplier at Bard. Calculate the tax multiplier.
Why is the tax multiplier small than the spending multiplier?
0001
b) Calculate and show graphically equilibrium output and income at
Bard
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