The current account is the sum of ________. A) net exports, ...

[stevenposner]

The current account is the sum of ________.
 
  A) net exports, net factor income from abroad and net transfers from abroad.
  B) consumption, investment, and government expenditure
  C) net exports and net investment from abroad
  D) net exports and net transfers from abroad

Question 2

Suppose policy makers want to increase GDP by 450 billion. If the marginal propensity to consume is 0.9, by how much must government spending increase to achieve this target?
 
  What will be an ideal response?

[amy.lauersdorf90]

Answer to Question 1

A

Answer to Question 2

The multiplier would be 10 in this case, so government spending must increase by 45 billion.

[stevenposner]

Gracias!

[pratush dev]

Thanks for the timely response, appreciate it