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olga2289 [7]
4 years ago
8

Suppose that investment demand increases by $300 billion in a closed and private economy (no government or foreign trade). Assum

e further that households have a marginal propensity to consume of 80 percent. Ultimately, how much will aggregate demand increase? Enter your answer in billions. For example if your answer is $600 billion then enter 600. If your answer is $1,500 then enter 1500.
Business
1 answer:
aleksandrvk [35]4 years ago
4 0

Answer:

Aggregate demand increase by $1500 billion.

Answer is 1500

Explanation:

Investment demand increases by $300 billion.

MPC = 0.80

Multiplier = 1 / (1-MPC)

Multiplier = 1 / (1-0.8)

Multiplier = 1 / 0.2

Multiplier = 5

Multiplier = Change in GDP / Change in investment

5 = Change in GDP / $300 billion

Change in GDP = 5 * $300 billion

Change in GDP = $1500 billion.

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Answer:

D. Management

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I hope my answer helps you

6 0
3 years ago
CEO compensation is often in the news. In response to this, some CEOs at large companies have agreed to set their base pay at $1
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3 years ago
A stockbroker predicts whether a stock will go up or down by tossing a coin and so has a 50% chance of making a correct predicti
kolezko [41]

Answer:

A skilled  broker will be right at  60% of time compared to 50%

Explanation:

Solution

Given that:

Now,

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8 0
3 years ago
1. A department is looking for an entry-level cashier. One of the job applicants is a cashier with 30 years of experience as a c
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A cashier who has 6 months of experience be more suitable for such role in the department, and will also take lesser pay than the one with 30 years of experience.

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Learn more about cashier here:

brainly.com/question/27622487

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3 years ago
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