Assume that the multiplier effect for Mexico is 0.85 for an increase in spending by the U.S. government by $1 . Therefore, a $20 billion decrease in spending by the U.S. government results in:
a. a $23.5 billion increase in Mexican real GDP.
b. a $133.3 billion decrease in Mexican real GDP.
c. a $3 billion decrease in Mexican real GDP.
d. a $17 billion decrease in Mexican real GDP.
e. a $23.5 billion decrease in Mexican real GDP.
d
You might also like to view...
Refer to the below graphs. (Assume that the pre-migration labor force in Country A is 100 and that it is 150 in country B.) What part of domestic output in country A is the total wage bill before and after the immigration?
A. $500M before and $800M after
B. $500M before and $100M after
C. $400M before and $100M after
D. $400M before and $500M after
If the equilibrium price level is 135 but the actual price level is 150, then
A) firms increase their production because they are able to sell their output at a higher than expected price. B) aggregate demand will decrease to restore equilibrium. C) aggregate demand will increase to restore equilibrium. D) the quantity of real GDP demanded is less than the quantity of real GDP supplied. E) the quantity of real GDP demanded is greater than the quantity of real GDP supplied.
President Obama has proposed a goal that everyone complete at least one year of formal education or training beyond high school
This policy would ________ the production of current consumption goods and services and ________ the future production of consumption goods and services. A) decrease; increase B) increase; decrease C) not change; increase D) increase; increase
When you open a checking account at Bank of America, Bank of America
A) has more deposits, but excess reserves remain unchanged. B) has more reserves, but excess reserves remain unchanged. C) has more reserves and more excess reserves. D) has more deposits and less in excess reserves.