Suppose that an initial $20 billion increase in investment spending expands GDP by $20 billion in the first round of the multipl
ier process. If GDP and consumption both rise by $10billion in the second round of the process, what is the MPC in this economy?
Instructions: Round your answer to one decimal place
MPC = $
What is the size of the multiplier?
Instructions: Round your answer to one decimal place
The multiplier = $
If, instead, GDP and consumption both rose by $12 billion in the second round, what would have been the size of the multiplier?
Instructions: Round your answer to one decimal place
The multiplier = $
Instructions: Round your answer to one decimal place
MPC = $
What is the size of the multiplier?
Instructions: Round your answer to one decimal place
The multiplier = $
If, instead, GDP and consumption both rose by $12 billion in the second round, what would have been the size of the multiplier?
Instructions: Round your answer to one decimal place
The multiplier = $
1 answer:
You might be interested in