Suppose the MPC is 0.80. By how much must investment spending increase for GDP to go up

Question:

Suppose the MPC is 0.80. By how much must investment spending increase for GDP to go up $50 billion?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Economics Barrons Business Review Series

ISBN: 9781438008776

6th Edition

Authors: Walter J. Wessels

See More Books

Question Posted: Feb 18, 2024 04:01 AM

See More Questions

1. In our simple model, if C = 100 + 0.8y, and I = 50, equilibrium output will be ______. 2. If in Exercise 3.1 I increase to 100, a. The equilibrium income will be ______. b. The multiplier is...
1. An increase in the price level will GDP and thereby move the economy the aggregate demand curve. 2. At any price level, the income-expenditure model determines the level of equilibrium output and...
KYC's stock price can go up by 15 percent every year, or down by 10 percent. Both outcomes are equally likely. The risk free rate is 5 percent, and the current stock price of KYC is 100. (a) Price a...
Carl contributes equipment with a $50,000 adjusted basis and an $80,000 FMV to Cook Corporation for 50 of its 100 shares of stock. His son, Carl Jr., contributes $20,000 cash for the remaining 50...
What are the specific policies and operating practices that Nucor has employed to implement and execute its low-cost provider strategy?
Power Drive Corporation designs and produces a line of golf equipment and golf apparel, Power Drive has 100,000 shares of common stock outstanding as of the beginning of 2021. Power Drive has the...
Explain how the pseudo-F statistic accounts for both separation and cohesion.
A fire recently destroyed a substantial portion of Manley Companys production capacity. It will be many months before capacity can be restored. During this period, demand for the firms products will...
On August 31, Year 10, Harvey Co. decided to change from the FIFO periodic inventory system to the weighted average periodic inventory system. Harvey uses U.S. GAAP, is on a calendar year basis, and...
This question illustrates the accelerator effect. Let WQ equal the number of widgets consumed in a year. Every 1,000 widgets require a widgetmaking machine to produce them. Let WMMQ be the number of...
Suppose the MPC is 0.6. If at each level of income, people want to consume $4,000 more, how will income change? How will consumption change (break C s change into its initial autonomous increase and...
Find the area enclosed by the curve r2 = 9 cos 5( ?
A 10 mm thick steel plate with dimensions of 10 x 10 cm and a density of 7.85 g/cm was submerged in seawater for a period of 1 year. During this period the weight of the plate reduced by 20 grams. Kw...
Consider the function f(x1,x2) = x 5x1x2 + 6x at the point x = (0, 2) and search direction p = (1, 1). 1. Write down the first-order Taylor approximation to f(x + ap), where a is the step size. 2....
Nike Company has hired a consultant to propose a way to increase the company\'s revenues. The consultant has evaluated two mutually exclusive projects with the following information provided for...
What are the most effective way to manage routine and catastrophic disasters, and are they different?
The Wall Street Journal reported that of taxpayers with adjusted gross incomes between and itemized deductions on their federal income tax return. The mean amount of deductions for this population of...
Boyle's Law states that when a sample of gas is compressed at a constant temperature, the product of the pressure and the volume remains constant: PV = C. (a) Find the rate of change of volume with...
Given that all the choices are true, which one concludes the paragraph with a precise and detailed description that relates to the main topic of the essay? A. NO CHANGE B. Decades, X-ray C. Decades...
Discuss the following statement: In a perfectly competitive market, in the long run consumers benefit from reductions in costs, but firms dont. Dont firms also benefit from cost reductions because...
Some professions, like hair cutting or hair braiding, are fairly close to perfectly competitive. These professions sometimes succeed in getting the government to establish licensing requirements that...
An article in the Wall Street Journal discussed the sidewalk vegetable stands in New York Citys Chinatown. About 80 of these small vegetable stands operate along a handful of streets in that...
When credit terms for a sale are 2/15, n/40, the customer saves by paying early. What percent (rounded) would this savings amount to on an annual basis
An industrial robot that is depreciated by the MACRS method has B = $60,000 and a 5-year depreciable life. If the depreciation charge in year 3 is $8,640, the salvage value that was used in the...
What determines a firm's beta? Should firm management make changes to its beta? Be sure to consider the implications for the firm's investors using CAPM.

Suppose the MPC is 0.80. By how much must investment spending increase for GDP to go up

Question:

Step by Step Answer:

The multiplier is 4 102...View the full answer

Economics Barrons Business Review Series

Students also viewed these Business questions