Suppose that investment spending decreases by $300 and no leakages occur except household saving. Assume further that households have a marginal propensity to save of 0.4 The spending multiplier in this case is 120 and the total or cumulative change in aggregate demand or spending as a result of the change in investment would be 180 sign. $ Enter numbers only rounded to one decimal place (no dollar sign). If negative, enter the minus (-)

Suppose that investment spending decreases by $300 and no leakages occur except household saving. Assume further that households have a marginal propensity to save of 0.4 The spending multiplier in this case is 120 and the total or cumulative change in aggregate demand or spending as a result of the change in investment would be 180 sign. $ Enter numbers only rounded to one decimal place (no dollar sign). If negative, enter the minus (-)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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