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2 years ago

Suppose the marginal propensity to consume is 0.8 and the government cuts taxes by $40 billion. real gdp will _ by _.

1 answer:

8 0

If the government cuts taxes by $40 billion, this puts more money in consumers' pockets. Given an MPC of 0.8, this means they will spend $32 billion

Evaluating :

(0.8 × $40 = $32).

The correct answer is an increase of $32 billion.

GDP:

Gross domestic product (GDP) is a measure of the final goods and services produced with a specific region over a specified period of time. It is computed as follows:

GDP = Consumption + Government Spend + Investment + Net Exports

What is Marginal Propensity to Consume (MPC)?

Marginal propensity to consume (MPC) is measured as the portion of an increase in pay that a consumer would spend on goods and services as opposed to saving. Essentially, it is measuring how sensitive consumption in an economy is to increases in income. MPC is important in economics because it illustrates the effect that increased government spending has on the economy.

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Linda's health insurance plan requires that she have a physician that manages all of her healthcare. Linda, most likely, has wha

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Linda has a Health Maintenance Organization (HMO) insurance plan.

Further Explanation:

Health Insurance plan:

Health insurance plan is a type of insurance plan where the insured party gets the coverage for the medical expenses incurred. Health insurance plan would reimburse for the medical treatment that is recorded in the contract between the insurance company and the insured party.

Health Maintenance Organization (HMO):

Health Maintenance Organization provides health plans to the individuals. HMO is a private or public organization that renders health services to its user or subscribers. Subscribers are the individuals who opt for HMO as a health insurance plan. HMO does not provide the health services directly to the user or subscribers. HMO provides the services through various medical insurance provider entities such as doctor, physician, specialist and clinic facility.

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Linda’s insurance plan:

In the given case, Linda’s insurance plan requires her physician to manage all her health care.

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<u>So the current insurance plan is a Health Maintenance Organization (HMO).</u>

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Answer details:

Grade: Senior School

Subject: Business Law

Chapter: Insurance

Keywords: Linda, Insurance plan, Healthcare, Physician, Health insurance, Insurance, Health Maintenance Organization, HMO, Insurance, Health insurance plan, Business law, Type of insurance plan.

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3 years ago

Read 2 more answers

What happens to the demand for

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Demand decreases

Explanation:

Substitute goods are products that can be used in place of each other. Goods are described as substitutes if a customer can use them interchangeably and get equal or almost the same satisfaction. Tea and coffee will be substitutes if a customer can consume either of them and be happy.

If the price of a substitute good declines, customers will prefer consuming it instead of the other product. The other product's demand will decrease due to a change in customer preferences as a result of a lower price.

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3 years ago

Suppose the marginal propensity to consume is 0.8 and the government cuts taxes by $40 billion. real gdp will _____ by _____.

Suppose the marginal propensity to consume is 0.8 and the government cuts taxes by $40 billion. real gdp will _ by _.