Answer the following questions:Instructions: Enter your answers rounded to the nearest whole number.a. By how much will GDP change if firms increase their investment by $13 billion and the MPC is 0.80?2$billionb. If the MPC is 0.50?$billion

multiplier=1/(1-MPC) change in GDP=change in investment *multiplier a) multiplier=1/(1-0.8)=5 change…

Answered: a. By how much will GDP change if firms…

a. By how much will GDP change if firms increase their investment by $13 billion and the MPC is 0.80? | billion b. If the MPC is 0.50? | billion

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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