An economy has a MPC of 0.80. Suppose only that taxes are increased by $300 billion. Calculate the tax mulitplier and determine the effect (amount and direction) on GDP. Multiplier est Amount = $bn Please enter only a Capital I, D, or S Direction: Increased (1) Decreased (D) or Stayed Constant (S)

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Chapter1: Making Economics Decisions
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An economy has a MPC of 0.80.
Suppose only that taxes are increased by $300 billion. Calculate the tax mulitplier and determine the effect (amount and direction) on GDP.
Multiplier
est
Amount = $bn
Please enter only a Capital I, D, or S
Direction: Increased (1) Decreased (D) or Stayed Constant (S)
Transcribed Image Text:An economy has a MPC of 0.80. Suppose only that taxes are increased by $300 billion. Calculate the tax mulitplier and determine the effect (amount and direction) on GDP. Multiplier est Amount = $bn Please enter only a Capital I, D, or S Direction: Increased (1) Decreased (D) or Stayed Constant (S)
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