If investment increases by $200, and as a result GDP increases by $800, then the a) multiplier is 1/4. O b) marginal propensity to consume is 0.75. c) marginal propensity to consume is 0.25. d) multiplier is 3. e) marginal propensity to save is 0.75.
If investment increases by $200, and as a result GDP increases by $800, then the a) multiplier is 1/4. O b) marginal propensity to consume is 0.75. c) marginal propensity to consume is 0.25. d) multiplier is 3. e) marginal propensity to save is 0.75.
Chapter9: Aggregate Expenditures
Section: Chapter Questions
Problem 10E
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Transcribed Image Text:If investment increases by $200, and as a result GDP increases by $800, then the
a) multiplier is 1/4.
O b) marginal propensity to consume is 0.75.
c) marginal propensity to consume is 0.25.
d) multiplier is 3.
e) marginal propensity to save is 0.75.
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