Assume that the short run equilibrium GDP is $4,000 billion and the potential GDP is $5,000 billion. The marginal propensity to consume is 0.8. Would you classify this society more inclined to consume or save? Explain .
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Assume that the short run equilibrium
Would you classify this society more inclined to consume or save? Explain .
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- Rosalind won $1000 cash in a lucky draw. Find her marginal propensity to consume if she spent $600 out of the winnings and saved $400.In 2009, the US Federal government cut taxes by approximately $300 billion, increased government spending by approximately $300 billion, and increased transfer payments by approximately $200 billion. Answer the following questions, assuming the marginal propensity to consume was 0.75. What was the maximum change in GDP from the government spending? Show your work.Assume that the short run equilibrium GDP is $4,000 billion and the potential GDP is $5,000 billion. The marginal propensity to consume is 0.8. [a] Would you classify this society more inclined to consume or save? Explain . [b] By how much would you advise the President to adjust the government spending and the taxes? Show your work.
- The government raises taxes by $100 billion. If the marginal propensity to consume is 0.8 What happens to the following? Do they rise or fall? By what amounts? a)InvestmentIf planned expenditures are below actual production, what will happen to income? Explain the process by which this happens.Which shows income and consumption levels for period 1 through 7, what is the marginal propensity to consume ?
- The government spends an additional $668 billion and the marginal propensity to consume is 79%. How much will GDP increase due to this additional government spending? Enter your answer in billions and round to two decimal places.You Suppose the government increases education spending by $20 billion. If the marginal propensity to consume is 0.75, how much will total spending increase? Instructions: Round your response to one decimal place. $ billionThe marginal propensity to consume for this economy is …………. if income rises from $9000 to $10000 and consumption is rises from $750 to $1500 0.650. 0.750. 0.650 or 0.664, depending on whether income is $10,000 or $11,000. 0.800.
- The image attached, is a screen shot of the question. The question is: If the marginal propensity to consume was 0.8, low large would each of the following need to be in order to restore full-employment equilibrium? A. A tax increase ________billion B. A government spending cut $_________billion C. A cut in income transfers $________billion. I need to know how to figure this out. Again the screen shot of the question with the graph it attached.1.The marginal propensity to consume in this economy is 2.The equilibrium level of output in this economy isSuppose the government increases expenditures by $50 billion and the marginal propensity to consume is 0.90. By how much will equilibrium GDP change? The change in equilibrium GDP is: $ billion. (Round your solution to one decimal place.)