Complete the following table by calculating the value of the multiplier and identifying the change in Y*

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Complete the following table by calculating the value of the multiplier and identifying the change in Y* due to the change in autonomous spending. How does the value of the multiplier change with the marginal propensity to consume?

Value of Change in spending Change in MPC multiplier Y* AC = + $50 million 0.5 Al =- $10 million 0.6 AC = - $25 million

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Macroeconomics

ISBN: 978-1319120054

3rd Canadian edition

Authors: Paul Krugman, Robin Wells, Iris Au, Jack Parkinson

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Question Posted: Dec 03, 2018 07:21 AM

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Complete the following table by calculating the value of the multiplier and identifying the change in Y*

Question:

Value of Change in spending Change in MPC multiplier Y* AC = + $50 million 0.5 Al =- $10 million 0.6 AC = - $25 million 0.75 Al = + $20 million 0.8 AC = - $2.5 million 0.9

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The value of the multiplier increases with an increase in the margina...View the full answer

Macroeconomics

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