If the marginal propensity to save (MPS) is 0.25, the value of the spending multiplier is:
A. 1.
B. 2.
C. 4.
D. 9.
Answer: C
You might also like to view...
At long-run macroeconomic equilibrium, ________
A) an inflationary gap exists B) real GDP equals potential GDP C) a recessionary gap exists D) real GDP is less than potential GDP but is as close as it is possible to be
The situation in which one firm can produce the total output of the market at lower cost than several firms is called a
A) natural monopoly. B) pure monopoly. C) ruling monopoly. D) cost monopoly.
If gross domestic purchases are ________, then net exports are ________.
A. less than gross domestic product; positive B. equal to zero; also equal to zero C. greater than gross domestic product; positive D. greater than gross domestic product; greater than net imports
If a brewery wants to raise funds to purchase a new fermenting vat, it does so in the
A) factor market. B) output market. C) product market. D) alcoholic beverages market.