A decrease in government purchases of $17 billion leads to an initial $10.2 billion decrease in withdrawals. a. In this case MPW is 0.20 O. MPC is 0.80 and the spending multiplier in this economy is marginal propensities and multiplier values rounded to 2 decimal places. b. With this change in government purchases the AD curve shifts to the left by $ the curve shift rounded to 1 decimal place. Do not put a minus sign in your answer. c. As a result of this shift the equilibrium price level will decrease Enter your responses for 75 billion. Enter your response for the size of and equilibrium real output will decrease
A decrease in government purchases of $17 billion leads to an initial $10.2 billion decrease in withdrawals. a. In this case MPW is 0.20 O. MPC is 0.80 and the spending multiplier in this economy is marginal propensities and multiplier values rounded to 2 decimal places. b. With this change in government purchases the AD curve shifts to the left by $ the curve shift rounded to 1 decimal place. Do not put a minus sign in your answer. c. As a result of this shift the equilibrium price level will decrease Enter your responses for 75 billion. Enter your response for the size of and equilibrium real output will decrease
Chapter11: Fiscal Policy
Section: Chapter Questions
Problem 1.4P
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A decrease in government purchases of $17 billion leads to an initial $10.2 billion decrease in withdrawals.
a. In this case MPW is 0.20 O. MPC is 0.80 and the spending multiplier in this economy is
marginal propensities and multiplier values rounded to 2 decimal places.
5 Enter your responses for
b. With this change in government purchases the AD curve shifts to the left by $ 75 billion. Enter your response for the size of
the curve shift rounded to 1 decimal place. Do not put a minus sign in your answer.
c. As a result of this shift the equilibrium price level will decrease
and equilibrium real output will decrease](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F0b55e502-3356-403e-9e2a-a2d6cc03d264%2F55f1a0f4-fce4-4752-b1d1-68bed4d4a39d%2Fu6e7p0l_processed.jpeg&w=3840&q=75)
Transcribed Image Text:nts
A decrease in government purchases of $17 billion leads to an initial $10.2 billion decrease in withdrawals.
a. In this case MPW is 0.20 O. MPC is 0.80 and the spending multiplier in this economy is
marginal propensities and multiplier values rounded to 2 decimal places.
5 Enter your responses for
b. With this change in government purchases the AD curve shifts to the left by $ 75 billion. Enter your response for the size of
the curve shift rounded to 1 decimal place. Do not put a minus sign in your answer.
c. As a result of this shift the equilibrium price level will decrease
and equilibrium real output will decrease
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