1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
klemol [59]
3 years ago
5

Suppose that when your income increases by $300, your consumption expenditures increases by $240.

Business
1 answer:
Citrus2011 [14]3 years ago
5 0

Answer:

The MPC is 0.8

The multiplier or k is 5

The increase in income would be $20 million.

Explanation:

The marginal propensity to consume (MPC) is the proportion of increased disposable income that consumers spend. It is a metric to quantify the induced consumption and how an increase in consumer spending occurs as a result of increase in income.

MPC is calculated as follows,

MPC = Change in consumer spending / change in income

MPC = 240 / 300

MPC = 0.8 or 80%

To calculate the multiplier, we simply use the following formula,

Multiplier or k = 1 / (1 - MPC)

k = 1 / (1 - 0.8)

k = 5

So, the expenditure multiplier for the economy would be 5.

To calculate the increase in income, we will multiply the investment amount by the expenditure multiplier.

Income increase = 4000000 * 5

Income increase = $20000000 or 20 million

You might be interested in
True or false? The best way to choose the right social media tool is to think about your business goals, then narrow down your c
DaniilM [7]
Don't completely understand the question, but i'm pretty sure it's TRUE. I think thi sbecause you shoul dalways think about what you are going to post or say because once you do it is there forever. Even if you delete a tweet someone most likely screenshotted it or saved it and could have sent it to countless people for all you know... again not sure if this helped or not, but good luck
4 0
3 years ago
Market failure describes a situation in which the market itself ________ in a way that balances social costs and benefits.
Lina20 [59]

A situation known as a "market failure" occurs when the market itself is unable to efficiently distribute resources in a way that balances social costs and benefits.

Market failure refers to a situation where there is an inefficient allocation of products and services on the open market. The individual incentives for rational behavior do not result in rational outcomes for the collective in a market failure.

In other words, each person chooses what is best for themselves, but those choices end up being bad for the collective. This can occasionally be demonstrated in conventional microeconomics as a steady-state disequilibrium condition.

To learn more about Market failure here

brainly.com/question/18958169

#SPJ4

8 0
1 year ago
Corporate triple A bond interest rates for 12 consecutive months are as follows:
pashok25 [27]

Answer and Explanation:

The answer is attached below

5 0
3 years ago
Chegg As the U.S. economy continues to recover from the effects of the recession of 2007–2009, it is widely anticipated that the
Kazeer [188]

Answer:

Year 1= 1.5%

Year 5= 3.5%

Year 10= 3.5%

10 year nominal interest rate will be 3.5%

Explanation:

7 0
3 years ago
Exercise 13-26 (LO. 5) Henry is a 50% partner in HJ Partnership. This year, the tax form he receives from HJ (Schedule K-1 of Fo
Eduardwww [97]

Answer:

20,000

Explanation:

Henry has already received the $10,000 from HJ, It would be considered as a partial withdrawal of his share of profit. His total income should be 20,000 (40,000 x 50%) so the remaining 10,000 of his share of profit may be received by him later on a future date

Henry must report on his Form 1040 from HJ for the tax year = 40,000 x 50%

Henry must report on his Form 1040 from HJ for the tax year = 20,000

3 0
3 years ago
Other questions:
  • What are the procedures of manage discrepancies?
    14·1 answer
  • Best Value Outlet recently announced that it intends to pay dividends of $0.40, $0.60, $0.75, and $1.00 per share over the next
    7·1 answer
  • Why is it sometimes hard for LDCs to use their natural resources efficiently?
    6·2 answers
  • Stephanie Roe utilizes the direct write-off method of accounting for uncollectible receivables. On September 15, she is notified
    6·1 answer
  • Opunui Corporation has two manufacturing departments--Molding and Finishing. The company used the following data at the beginnin
    12·1 answer
  • As a preferred stockholder, you are entitled to numerous preferences and privileges over common stockholders. If you are a prefe
    5·1 answer
  • At which stage of the business cycle would the economy be at when GDP begins to rise and the unemployment rate begins to fall?
    15·1 answer
  • A firm in a purely competitive industry has a typical cost structure. The normal rate of profit in the economy is 5 percent. Thi
    7·1 answer
  • What are healthcare cost estimates for a retired couple starting in 2030 and 2040?
    7·1 answer
  • Accounting information include investors and regulators; business owners and employees are included in the intended users of:___
    6·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!