Answered: Given that marginal propensity to save…

Business

Economics

Given that marginal propensity to save (MPS) is 0.5, what is the multiplier? 4 5 0.5

ECON MACRO

5th Edition

ISBN:9781337000529

Author:William A. McEachern

Publisher:William A. McEachern

Chapter11: Fiscal Policy

Section: Chapter Questions

Problem 1.6P

See similar textbooks

Related questions

Q: Calculate the value of multiplier if MPS is 0.73

A: In a fractional-reserve banking system, a money multiplier is one of several closely related ratios…

Q: Part 1: Aggregate expenditure and Equilibrium output. Assume the following Consumption function (C)…

A: The marginal propensity to save (MPS) basically refers to the percentage of an increase in overall…

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: an increase in MPC, reduces the multiplier? true or fulse

A: The marginal propensity to consume is the concept which explains the increase in the consumption…

Q: If the multiplier is 10, the marginal propensity to consume must be 0.1. True False

A: The multiplier could be measured by using the following formula: Multiplier (k) =11-MPC Given,…

Q: If the marginal propensity to save (MPS) is 0.5, the multiplier will be A. 2. B. 2.5. C.…

A: Marginal propensity to save (MPS): The marginal propensity to save or (MPS) is that proportion of…

Q: If the multiplier is 5, then the MPC is Answer 0.05 0.5 0.6 0.8 Question 43 In a certain economy,…

A: Hello. Since you have posted multiple questions and not specified which question needs to be…

Q: What multiplier would you use to work out a decrease of 20%?

A: A multiplier in economics describes the connection between changes in an exogenous variable, such as…

Q: If the multiplier is 5 , what is the marginal propensity to save (MPS)? 5 0.20 0.80 0.50

A: The value of multiplier is given to be as = 5 We have to calculate the value of marginal propensity…

Q: Suppose the MPC is .80, the MPI is .10, and the income tax rate is 10 percent. What is the…

A: Given that, MPC = 0.80, MPI = 0.10 and income tax rate is 10 percent.

Q: Suppose that the MPC is .75 and the MPM is .1. What is the size of the multiplier?

A: MPC refers to Marginal Propensity to Consume. It is the proportion of the additional income which…

Q: If consumers save 21 cents out of every dollar received, the Multiple Choice marginal propensity…

A: Introduction Economists use the marginal propensity to save to measure the connection between both…

Q: The value of multiplier is 1.35 Calculate the value of Marginal propensity to save

A: The inverse of Marginal propensity to save gives the value of multiplier. k = 1/MPS

Q: If marginal propensity to save is 0.1 Find the value of multiplier

A: The information being given to us is as follows:- Marginal propensity to save = 0.1 We need to find…

Q: Calculate the value of multiplier if MPS is 0.43

A: The information given to us is as follows:- Marginal propensity to save = 0.43 We need to calculate…

Q: What is the value of MPC if marginal propensity to save is .1.

A: Given the value of marginal propensity to save = 0.1 Now we have to find the value of MPC.

Q: If the marginal propensity to consume of an economy is 0.7, then the simple spending multiplier is:

A: Marginal propensity to save is defined as that proportion of the aggregate increase in income which…

Q: If the value of marginal propensity to save is 0.2 determine the exact value of investment…

A: Investment multiplier is denoted to be as the amount of generally the Income/Output amplifies…

Q: The value of Marginal propensity to consume is double the value of Marginal propensity to save.…

A: We are given with the following information:- The value of MPC is double that of MPS I.e MPC = 2MPS…

Q: In an economy the value of the marginal propensity to save is 0.39. calculate the value of MPC

A: # The value of marginal propensity to consume is given by the difference as:- MPC = 1 - MPS

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: ind the value of multiplier when the value of MPS is 0.891

A: Initially in the question, We have to find the value of multiplier = ? MPS = 0.891

Q: What would be the value of Marginal propensity to save when the multiplier is given as 7.9

A: Given: Multiplier = 7.9 To find: The value of MPS.

Q: If the value of multiplier is 32 find the MPC and MPS.

Q: Calculate the value of Marginal propensity to save when it's given that MPC = 0.65

Q: If the marginal propensity to save (MPS) is 1/8, what is the value of the simple spending…

Q: A company is growing rapidly, and is investing nearly all of its income, so its marginal propensity…

A: Disposable income refers to the income available to the people after the payment of tax and social…

Q: Calculate the value of Multiplier if change in income is $2300 and the change in investment is $700

A: The data presented in the question above:- Change in income = $2300 Change in investment = $700 The…

Q: The value of marginal propensity to consume(MPC) is 0.61 Calculate the value of multiplier

A: Before preceding to the explanation and numerical part for our problem, let's first understand what…

Question

Given that marginal propensity to save (MPS) is 0.5, what is the multiplier?
O 2
O 4
0.5

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Urgently need
If the multiplier is 4, what is the MPC? O 0.25 O 0.5 O 0.75 1
What is the initial change in consumption if an economy's MPC is 0.75 and there is a decrease in taxes of $1 billion? O $1.75 billion O $1 billion O $1.33 billion O $0.75 billion
If government spending rises by $100, mps = 0.2, then the GDP multiplier is O 5 O 4 O 1
Suppose that Country X's government wants to increase output. If the multiplier equals 2.5 and the government increases spending by 300, how much will output increase by? O 750 O 200 50 100
In a macro model where the marginal propensity to consume out of disposable income is 0.80, the net tax rate is 0.25, and the marginal propensity to import is 0.11, the simple multiplier will be O A. 3.448 O B. 2.041 OC. 0.490 O D. 1.961 O E. 1.408
Using the table1 below, calculate the marginal propensity (MPS) to save. Income Consumption (Dollars) (Dollars) 50,000 48,000 66,000 62,000 O a. 0.363 O b. 0.125 OC. 0.675 O d. 1.50
Assume a closed economy, that taxes are fixed, and the marginal propensity to consume is equal to 0.66. What is the government spending multiplier? O 1.51 3.33 3.03 33.3
Problem 3 Given the below data Disposable Income Consumption expenditure (dollars) 0. 100 100 180 200 260 300 340 400 420 500 500
3
A AI PO© .. 3.71K/s O il.l 93% 5:13 AM HPS2125.220.ASIGNMENT-Unsaved 1 a) The following data relate to the economy of XYZ Shilling "million" Investment 4,000 Government Spending 10,000 Autonomous consumption 8,000 Net exports 3,600 The marginal propensity to save of the economy of country XYZ is 0.4 Required: i) Write the consumption function of the economy. i) Compute the equilibrium level of income in the economy. QUESTION TWO a) Suppose the aggregate demand and supply schedules for a hypothetical economy are as shown below: Amount of real Amount of real domestic Price level domestic output supplied, billions output demanded, billions $ 200 (price index) 300 $800 400 250 800 600 200 600 S00 150 400 1,000 100 200 @ Use these sets of data to graph the aggregate demand and supply curves on the below graph. (i) What will be the equilibrium price and output level in this hypothetical economy? Is it also the full-enmployment level of outpur? Explain. (i) Why won't the 150 index be the…
(all data in real $ bn). On the graph below YO= 1782, Y1= 1868 and Y2 = 2018. If the initial increase in autonomous expenditure AA= 60, the realistic multiplier is AS E1 P1 EO PO ADO AD1 Y in real$ bn YO Y1 Y2 O a. 8 O b.3.00 Oc 3.93 O d. 1.43 O e. 3.75