If the marginal propensity to save is 0.15 in an economy, a $15 billion rise in consumption spending will increase: A GDP by $20 billion. B saving by $25 billion. C GDP by $100 billion. D GDP by $18 billion.

If the marginal propensity to save is 0.15 in an economy, a $15 billion rise in consumption spending will increase: A GDP by $20 billion. B saving by $25 billion. C GDP by $100 billion. D GDP by $18 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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Question

If the marginal propensity to save is 0.15 in an economy, a $15 billion rise in consumption spending will increase:

A GDP by $20 billion.

B saving by $25 billion.

C GDP by $100 billion.

D GDP by $18 billion.

Definition Video Definition Overall monetary value of all the complete or final services and goods that a country can produce within its domestic boundaries in a specific period. Video

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In a closed economy with no government, aggregate expenditure is saving plus investment. consumption plus investment. consumption plus the MPC. O MPC + MPS.
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