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Crazy boy [7]
1 year ago
14

suppose that the government increases spending by $100 billion as a stimulus package. if the marginal propensity to consume is 0

.6, then real gdp will:
Business
1 answer:
jeka941 year ago
3 0

If the marginal propensity to consume is 0.6, then real GDP will increase by $250 billion.

<h3>What will be the real GDP?</h3>

Real GDP is the gross domestic product of a country that has been adjusted for inflation. Gross domestic product is the total value of all the final goods and services that is produced by a country in a particular period.

Marginal propensity to consume is portion of disposable income that is spent on consumption. Marginal propensity to consume can also be described as the amount of real GDP that is spent on consumption. When spending increases, the value of the real GDP would also increase. The increase in real GDP would be as a result of an increase in spending and saving.

Increase in Real GDP = (MPC x increase in spending) + (MPS x increase in spending)

(100 x 0.6) + [(1 - 0.6) x 100 ] = $250 billion

To learn more about MPC, please check: brainly.com/question/19089833

#SPJ1

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Adelle's behavior is consistent with the post-conventional stage. In this stage a person develops his/her own sense of morality and <em>make conscious decisions</em>, not just relying on what the society believes to be right or wrong.

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