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Author Question: If the MPCis 0.75, the government spending multiplier is (Read 35 times)

ENagel

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Question 1

The government purchases multiplier is


◦ the difference between the old equilibrium level of output and the new equilibrium level of output.
◦ the ratio of the change in government purchases to the change in the equilibrium level of output.
◦ the ratio of the change in the equilibrium level of output to a change in government purchases.
◦ the difference between the new and old levels of government purchases.

Question 2

If the 
MPC is 0.75, the government spending multiplier is


◦ 4.
◦ 3.
◦ 2.5.
◦ 1.75.


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Marked as best answer by ENagel on Apr 19, 2019

karlss

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ENagel

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Reply 2 on: Apr 19, 2019
YES! Correct, THANKS for helping me on my review


kusterl

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Reply 3 on: Yesterday
Wow, this really help

 

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