Answer:
C. decreases; falls
Explanation:
As we know that
The rise in taxes results in low disposable income for individuals that lowered the spending of the consumer also the consumer spending is an element of the aggregate demand so ultimately it declines that result the curve to shift leftward or downward
Due to this, the real GDP also falls, and the price level too
Hence, the correct option is c.
Answer:
Multipier is 1/(1-.8) = 5
a. AD Shortfall/Multiplier = 100/5 = 20 billion
b. FS/MPC = 20/ .8 = 25 billion
c. 20 billion
Answer: Availability of data
Explanation: The issue here in the given case is that the presenter of the data, that is, john do not have it.
In the given case John forgot to update the power point presentation leading to non availability of data that he needed to present. The first step in any process of presentation is data availability, so therefore, we can conclude that john will not be able to give his presentation.
The equilibrium price and quantity increases
