Instructions: in parts a and b, round your answer to two decimal places. In part entering a negative number include a minus sign. a. Suppose the marginal propensity to consume (MPC) for a nation is 0.97. What is the tax multiplier for this nation? b. What is the tax multiplier for this nation if a $200 increase in taxes reduces real GDP by-$1800? c. How much will real GDP change if the tax multiplier is -2.5 and taxes are reduced by $300?

Instructions: in parts a and b, round your answer to two decimal places. In part entering a negative number include a minus sign. a. Suppose the marginal propensity to consume (MPC) for a nation is 0.97. What is the tax multiplier for this nation? b. What is the tax multiplier for this nation if a $200 increase in taxes reduces real GDP by-$1800? c. How much will real GDP change if the tax multiplier is -2.5 and taxes are reduced by $300?

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter18: Debates In Macroeconomics Over The Role And Effects Of Government

Section: Chapter Questions

Problem 3QP

See similar textbooks

Similar questions

Suppose the tax multiplier in an economy is -8. If the government wants to lower total spending (TS) by $8000 what should they do to Taxes (T)? Group of answer choices a. they should increase taxes by $64000 b. they should decrease taxes by $64000 c. they should increase taxes by $1000 d. they should decrease taxes by $1000
Suppose the MPC is 0.8. What is the tax multiplier in this economy? If the government were to lower taxes by $250 in this economy how much would Total Spending change as a result? Show your work.
Calculate the government spending multiplier and the tax multiplier if the MPC is 0.6. Show your work
Please help solve. The government started imposing a Digital Services Tax (DST) of six per cent on 1 January 2020 on foreign digital service providers (FSPs) in Malaysia. You are required explain and discuss the Digital Service Tax (DST) on how will Governments be impacted by the digital tax?
A. If your MPC = 0.6 and government spending (G) increases by $800. What will happen to the equilibrium income? The Effect of Taxation: Tax Multiplier = -MPC X Spending Multiplier Problems: B. If the MPC = 0.8 and taxes go up by $1000, what will happen to the equilibrium income? Please fully complete both problems.
In an economy such that: C = 200 + 0.80 (Y – T) Md = 0.20 Y - 10 R I = 40 - 20 R Ms = 200 + BP X = 30 - 0.05 Y BP = X + K T = 100 K = 20 + 10R G = 150 Determine the equilibrium levels of Y and R. If T increases to $150, what are the new Y and R? What is the tax multiplier?
What is the Laffer curve. Graphically show how to increase the tax revenue.
Explain carefully why the tax multiplier is negative and why it is smaller in absolute value than the government expenditure multiplier.
20 Lilliput is a country that has closed borders and does not import or export any goods or services; hence, they do not worry about trade with other countries. Total spending for the federal government of Lilliput for the last fiscal year was $24.19 billion. The country collected $22.9 billion in taxes during this same fiscal year. Assume government transfers were zero. Based on this information, what is Lilliput's budget balance? Enter your answer to two decimal places. budget balance: $ In the last fiscal year, Lilliput was running a budget surplus a budget deficit a balanced budget billion
←05 Survey Junkie 17 Gmail C https:/Assign W 2 https://highschools.foolproofonline.info/modules/taxes/board13.php YouTube Maps Dashboard - HMH Ed Okay, more Practice Questions: This is: Identify the type of tax for each example. Example 1: You are charged this tax by the federal government on your yearly pay. O Income Tax. O Sales Tax. O Property Tax. O Excise Tax. This is: Example 2: You own a piece of property and receive a tax bill from the state each year. O Income Tax. O Sales Tax. O Property Tax. O Excise Tax. EN Anglais (ats-Unis) E $ 4 0.6.76 Edmen w foolpro Cc X R 5 T Y & 7 F9 8
Suppose that real GDP for an economy is currently 16,000 billion, the government purchases multiplier is 2.2 and the tax multiplier is -1.2. If the government deploys additional spending of 600 billion and cuts taxes by 120 billion, where will GDP end up (in billion)?
If the MPS in an economy is 0.2. What is the tax multiplier? Group of answer choices a. 4 b. 5 c. -4 d. -5