an open economy with government, the marginal propensity to consume is 0.67, the tax rate is 0.2 and the marginal propensity to import is 0.25. Calculate the multiplier (to 2 decimal places).

Q: Suppose that business executives are very optimistic, and they raise their investment spending. What…

A: Keynesianism, due to its potential to ease economic downturns through government involvement, gained…

Q: Two countries are in a recession. Country A has an MPC of 0.8 and Country B has an MPC of 0.6. In…

A: Country A MPC = 0.8G Government Spending Multiplier=11-MPCGovernment Spending…

Q: If marginal propensity to save is 0.22  Calculate the value of k(Multiplier)

A: We are given with the value of marginal propensity to save as:- MPS = 0.22 Multiplier = k  = ?

Q: A $300 million decrease in investment spending will increase real GDP by more than $300 million. Is…

A: Gross domestic product is the final combination of goods and services in a country. GDP is an…

Q: The marginal propensity to consume (MPC) is 0.90. The multiplier is 10. (Round your answer to one…

A: Marginal propensity to consume is the proportion of the disposable income that a person wants to…

Q: If the MPC is 0.9 what will happen to GDP if the government cut spending bt S2.

A: Given data: MPC, c=0.9Government spending, G=$2

Q: Suppose the interest on the debt was $700 billion. If interest is paid domestically, 90% will be…

A: Given: The total debt of the country is given as $700 billion  100% interest is paid domestically…

Q: how do we connect the MPS, MPC, spending multiplier and total change?

A: The multiplier effect describes the impact of an initial change in spending or investment on the…

Q: The government of a country decides to double its current level of spending, causing real GDP to…

A: Gross domestic product (GDP): - GDP is the market value of all final goods and services produced in…

Q: With an MPC of 0.8, government spending increases $20 billion while taxes decrease $10 billion.…

A: The effect of increase in government spending can be seen as: Multiplier: 11-MPC=11-0.8=5 The…

Q: If government spends $10B and the MPC in the economy is .8.  What will be the total change in GDP?

A: A multiplier is a term used in economics to describe an economic factor that, when increased or…

Q: A simple closed economy, with an mpc equal to 0.75. The government has passed a balanced budget…

A: Given: MPC= 0.75 Economy goes into a recession, so government spending increases by 40 million

Q: Consumers of a country spend 83.21% of their disposable income. If the government wants to increase…

A: The tax multiplier would result in the change in the tax which would create a multiplier effect…

Q: The maginal propensity to consume of country is 0.8 and the country increases its investment by 5…

A: Marginal Propensity to Consume  (MPC) = 0.8 Change in investment = 5 billion

Q: The table below shows data for three fictitious countries. a. Compute the current MPC for each…

A: MPC is the ratio of change in consumption to change in income. It shows how much of the income is…

Q: If the MPC is 0.9 what will happen to GDP if the government cut spending bt $2.

A: ∆Y = 11-c∆G where Y = GDP            c = MPC            G = government spending

Q: If the government spends 10 million and the multiplier is 5, then real GDP will increase by: Group…

A: If the government spending = 10 million Multiplier = 5 Then government spending multiplier is…

Q: The table below shows data for three fictitious countries. a. Compute the current MPC for each…

A: MPC is the Marginal propensity to consume it shows the change in consumption in relation to the…

Q: MPC is 0.60. To increase GDP by $360, how much should we decrease taxes?

A: MPC is 0.60. To increase GDP by $360, how much should we decrease taxes?

Q: In the country of Krugman, a business spent $100 million building a factory. GDP eventually…

A: "Since you have asked multiple questions, we will solve first question for you .. If you want any…

Q: In Russia, the value of multiplier is 7  Calculate the value of MPS

A: The information being given is:- Multiplier = 7 Marginal propensity to save = ?

Q: I'm doing economics homework and I'm being asked to find the multiplier when the MPS is 0.12 and MPC…

A: Given  MPS = 0.12 MPC = 0.88

Q: The country is experiencing a serious rise in inflation which the government wants to control…

A: Gross domestic product is the market value of all goods and services produced in the economy in a…

Q: Calculate MPS and it's given that MPC is 0.88

A: # Marginal propensity to save plus marginal propensity to consume always be equal to 1

Q: If taxes ane decreased by $200 billion, given an MPC of .6, calculate the change in GDP. Give your…

A: The method of state receiving funds from its residents to compensate for basic utilities is known as…

Q: Exactly how are the MPC and MPS computed? Explain it by a numerical example.

A: The Marginal Propensity to Consume(MPC) implies the change in consumption due to the change in the…

Q: Suppose the marginal propensity to consume is 0.8, the marginal propensity to import is 0.2, and…

A: Aggregate expenditure is the sum of consumption, investment, government spending and net exports.

Q: If the MPC is 0.8 and the investment in a country increases by $900 billion calculate the total…

A:

Q: The MPC is 0.5. what happens to the real GDP if the government increases spending by $10 million?

A: Given MPC = 0.5 Increase in government spending = $10

Q: The Spending Multiplier: The Math and Its Effects

A: The spending multiplier is also known as the fiscal multiplier. It is the multiple by which GDP of…

Q: You Suppose the government increases education spending by $20 billion. If the marginal propensity…

A: Here we calculate the total spending increases by using the given information  , so the calculation…

Q: Calculate MPC when a change in investment spending of 40 million leads to an increase in real GDP by…

A: Aggregate demand is the sum of consumption,  investment,  government spending and net export. This…

Q: If government spending is permanently increased, consumption and investment would fail? True or…

A: Government spending refers to the entirety of the funds disbursed by a government to cover the costs…

Q: The table contains information about the nation of Syldavia. There are no income taxes or imports in…

A: MPC(marginal propensity to consume The MPC is a measure that quantifies induced consumption, which…

Q: If the government spending increases, will net exports (X-M) increase?

A: The government spending refers to the spending done on the public goods and services. The government…