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3 years ago

If the marginal propensity to consume is 0.75, the multiplier for taxes and transfer payments is:1. 3

Business

1 answer:

valentinak56 [21]3 years ago

6 0

Answer:

option (1) 3

Explanation:

Data provided in the question:

Marginal propensity to consume, MPC = 0.75

Now,

Tax multiplier = 1 - [1 ÷ ( 1 - MPC ) ]

Tax multiplier = 1 - [ 1 ÷ ( 1 - 0.75 ) ]

Tax multiplier = 1 - 4

Tax multiplier = - 3

And,

Transfer payment multiplier = MPC ÷ [ 1 - MPC ]

Transfer payment multiplier = 0.75 ÷ [ 1 - 0.75 ]

Transfer payment multiplier = 0.75 ÷ 0.25

Transfer payment multiplier = 3

Hence,

Answer is option (1) 3

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The correct answer is (e) None of the choices listed are correct.

Explanation:

Solution

Given that:

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Now,

The Income is

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Add

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3 years ago

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Answer:

(a) 0.0085 rugs per dollar.

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Explanation:

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$\text{Labor productivity per dollar}=\frac{0.0084841628959\text{ rugs}}{\$}$

$\text{Labor productivity per dollar}\approx \frac{0.0085\text{ rugs}}{\$}$

Therefore, the labor productivity is 0.0085 rugs per dollar.

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$\text{Cost of solvent}=100\text{ gallons}\times \frac{\$5}{\text{ gallons}}=\$500$

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