<span>The marginal propensity to consume is a metric
that quantifies the concept of increase in consumption with an increase in
income. Mathematically MPC is defined as:</span>
MPC = Change in consumption / Change in income
Purchase of goods and services is considered as
consumption, therefore:
Change in consumption = $16 billion
In the government’s perspective, taxes are
considered as income, therefore the problem ask us to find for the necessary change
in tax collection to maintain equilibrium GDP. Substituting the values in the
formula:
0.80 = $16 billion / Change in income
Change in income = $20 billion
<span>Therefore the government should increase the tax collection by $20
billion.</span>
Answer: b.) post-purchase evaluation
Explanation:
Post-purchase evaluation as the term implies, is done after the product is purchased and checks how well the product does what it is meant to do.
When Mike asks customers to complete a feedback survey, they will indicate on the survey what they thought of his service such that he would know whether he fulfilled his purpose for the service. This therefore includes the customers in the post-purchase evaluation.
Answer
The answer and procedures of the exercise are attached in the following archives.
Explanation
You will find the procedures, formulas or necessary explanations in the archive attached below. If you have any question ask and I will aclare your doubts kindly.
Answer:
Providing a subsidy to correct for an underallocation of resources.
Explanation:
In Economics, subsidy can be defined as the amount of money or benefits such as tax reduction given by the government to sellers in order to sustain production and enable the buy to continuously purchase the product.
If the production of a product or service involves external benefits, then the government can improve efficiency in the market by providing a subsidy to correct for an underallocation of resources such as capital, land and labor used for production of these products.
