(a) Marginal propensity to consume (MPC) = 0.7
(b) Multiplier of this economy:
= 3.33
(c) Decrease government purchases by $300 billion,
Initial change in consumption = Change in government purchases × MPC
= $300 × 0.7
= -$210 billion
(d) This decreases income yet again, causing a second change in consumption equal to:
= Initial change in consumption × MPC
= -$210 × 0.7
= -$147 billion
(e) The total change in demand resulting from the initial change in government spending is:
= Change in government purchases × Multiplier
= $300 × 3.33
= -$1 trillion
Small business is difficult in the economy because its self made
Answer:
A. Consumers will be more likely to buy luxury goods in foreign markets.
The answer to the blank space is data.
The contents of the spreadsheet are the annual record of airfares to different cities from Chicago. This is what we call data – which are facts or statistics collected together for reference or analysis. Since Silway Travels plans to use the annual record information to contrast airfares during peak and off-season, it is clear that the data in this case would be used for analysis.
I believe this is true.
Hope this helps!
