This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: If MPC = 0.8, a 200 billion increase in government purchases would have what size effect on the ... (Read 27 times)

HudsonKB16

  • Hero Member
  • *****
  • Posts: 535
on: Jun 30, 2018
If MPC = 0.8, a 200 billion increase in government purchases would have what size effect on the first round of induced added consumption, and what total effect on AD?
 a. increase first round consumption by 80 billion; increase AD by 400 billion
  b. increase first round consumption by 160 billion; increase AD by 1 trillion
  c. increase first round consumption by 200 billion; increase AD by 1 trillion
  d. increase first round consumption by 800 billion; increase AD by 4 trillion

Question 2

If the deposit expansion multiplier is 20, what is the reserve requirement in the banking system?
 a. 20 percent
  b. 50 percent
  c. 2 percent
  d. 5 percent
  e. 10 percent


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

janeli1

  • Sr. Member
  • ****
  • Posts: 330
Reply #1 on: Jun 30, 2018
Answer to Question 1

b

Answer to Question 2

d


HudsonKB16

  • Hero Member
  • *****
  • Posts: 535
Reply #2 on: Jun 30, 2018
Thank you


janeli1

  • Sr. Member
  • ****
  • Posts: 330
Reply #3 on: Jun 30, 2018
No problemo


« previous next »
 

Did you know?

A strange skin disease referred to as Morgellons has occurred in the southern United States and in California. Symptoms include slowly healing sores, joint pain, persistent fatigue, and a sensation of things crawling through the skin. Another symptom is strange-looking, threadlike extrusions coming out of the skin.

Did you know?

Oliver Wendell Holmes is credited with introducing the words "anesthesia" and "anesthetic" into the English language in 1846.

Did you know?

To prove that stomach ulcers were caused by bacteria and not by stress, a researcher consumed an entire laboratory beaker full of bacterial culture. After this, he did indeed develop stomach ulcers, and won the Nobel Prize for his discovery.

Did you know?

More than 50% of American adults have oral herpes, which is commonly known as "cold sores" or "fever blisters." The herpes virus can be active on the skin surface without showing any signs or causing any symptoms.

Did you know?

No drugs are available to relieve parathyroid disease. Parathyroid disease is caused by a parathyroid tumor, and it needs to be removed by surgery.

An example of the founder effect with subsequent adaptive radiation. An example of the founder effect with subsequent adaptive radiation.
Experimental evidence of the effect of allelochemicals on plant production. Experimental evidence of the effect of allelochemicals on plant production.
The Increase in Divorce The Increase in Divorce
The DNA from one chromosome has a mass of ~20 billion Daltons The DNA from one chromosome has a mass of ~20 billion Daltons
Pasteur effect Pasteur effect
The constitutional division of Powers Between the National Government and the States The constitutional division of Powers Between the National Government and the States
Video: Cellular defenses (natural killer cells, phagocyte types & process of phagocytosis)

For a complete list of videos, visit our video library