If the marginal propensity to consume (MPC) is 0.9, the spending multiplier will be
A) 10.
B) 1.11.
C) 0.9.
D) 0.1.
A
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The time between the implementation of a fiscal action and when that action affects output, employment, or the price level is called a(n): a. recognition lag
b. implementation lag. c. operational lag. d. administrative lag.
About four out of five millionaires in the United States earned their money rather than inherited it
a. True b. False Indicate whether the statement is true or false
The annual cost of producing the entire output of goods and services in the economy
A. is total income. B. includes durable goods but excludes nondurable goods. C. includes financial transactions. D. can be calculated entirely on the basis of financial transactions.
Catherine is risk averse. When faced with a choice between a gamble and a certain level of wealth she will
A) always prefer the gamble. B) always prefer the certain level of wealth. C) prefer the gamble if the expected utility from it is higher than the utility from the certain level of wealth. D) prefer the certain level of wealth if the expected utility from the gamble is higher than the utility of the certain level of wealth.