If the marginal propensity to consume is 0.75, net taxes are fixed at $2,000 and real income rises by $12,000 . by how much will real consumption spending increase?
a. $9,000
b. $8,000
c. $7,500
d. $7,000
e. $10,000
A
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Investment spending at any level of national income is the investment producers
a. actually make b. expected to make c. expect to make d. make net of actual investment e. intend to make
The political incentive structure tends to
a. encourage a balanced budget regardless of economic conditions. b. discourage budget deficits during recessions. c. encourage budget surpluses during both recessions and expansions. d. encourage budget deficits during both recessions and expansions.
In Figure 5-3, the price elasticity of demand equals __________ between points T and U and equals __________ between points V and W
a.
0.33; 1.86
b.
0.54; 3
c.
3; 0.54
d.
1.86; 0.33
e.
2; 2
Figure 7.1 shows a monopolist's demand curve. If the monopolist increases output from four to five units, what is its marginal revenue?
A. $16 B. $15 C. $3 D. -$1