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Questions number 6 to 10 are based on having an MPC equal to 0.8 and potential output is P800 billion. Question #6. The government spending multiplier is: а. О.8 b. 1.25 С. 5 d. 4 7. If the current real GDP is P700 billion: * a. there is an inflationary gap b. there is a recessionary gap c. the economy is in long-run equilibrium d. government transfers should be decreased.

Questions number 6 to 10 are based on having an MPC equal to 0.8 and potential output is P800 billion. Question #6. The government spending multiplier is: а. О.8 b. 1.25 С. 5 d. 4 7. If the current real GDP is P700 billion: * a. there is an inflationary gap b. there is a recessionary gap c. the economy is in long-run equilibrium d. government transfers should be decreased.

ENGR.ECONOMIC ANALYSIS
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 a wealthy person writes a check to purchase a new car, he is employing money as _______. 

a. a measure of exchange.
b. a store of value.
c. a measure of value.
 
The tax multiplier is: 
a. -0.8
b. -1.25
c. -5
d. -4
 
If current real GDP is P700 billion, which of the following policies would bring the economy to potential output? 
a. decrease taxes by P100 billion
b. increase taxes by P100 billion
c. decrease taxes by P25 billion
d. increase taxes by P25 billion
 
* the attached photo is connected to the questions * 
Questions number 6 to 10 are based on having an MPC equal to 0.8 and potential output is P800 billion. Question #6. The government spending multiplier is: а. 0.8 b. 1.25 с. 5 d. 4 7. If the current real GDP is P700 billion: * a. there is an inflationary gap b. there is a recessionary gap c. the economy is in long-run equilibrium O d. government transfers should be decreased.
Transcribed Image Text:Questions number 6 to 10 are based on having an MPC equal to 0.8 and potential output is P800 billion. Question #6. The government spending multiplier is: а. 0.8 b. 1.25 с. 5 d. 4 7. If the current real GDP is P700 billion: * a. there is an inflationary gap b. there is a recessionary gap c. the economy is in long-run equilibrium O d. government transfers should be decreased.
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