If the MPC is 0.75 and the tax rate is 10%, the expenditure multiplier will equal
A) 0.48.
B) 1.48.
C) 3.08.
D) 3.6.
C
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If a firm needs one machine to produce a product, and must replace the machine when it wears out, then the firm should pick a durability level of the machine that
A) minimizes the expense today. B) minimizes the present discounted cost of having the machine forever. C) maximizes the future value of the machine. D) minimizes the future value of the machine.
When the U.S. dollar depreciates in relation to the Swiss franc:
a. a U.S. importer will need more dollars to pay for an invoice denominated in Swiss francs. b. a Swiss exporter will receive more Swiss francs for an invoice denominated in the exporter's currency. c. Swiss imports of U.S. goods will fall. d. the Swiss franc is now worth less in terms of the U.S. dollar. e. a U.S. exporter will receive fewer dollars for an invoice denominated in Swiss francs.
A country has output of $600 billion, consumption of $350 billion, government expenditures of $90 billion and investment of $60 billion. What is its supply of loanable funds?
a. $160 billion b. $150 billion c. $60 billion d. $30 billion
The economy has no international trade and no income taxes. In the short run, if government purchases were to decrease by $25 billion and the marginal propensity to consume was equal to 0.66 then real GDP would decrease by
A) $16.5 billion. B) $37.8 billion. C) $8.25 billion. D) $75 billion.