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5. (a) The multiplier process depicted in the following table is based on an MPC of 0.75. Recompute the first five cycles using an MPC

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5. (a) The multiplier process depicted in the following table is based on an MPC of 0.75. Recompute the first five cycles using an MPC of 0.80. Instructions: Round your answers to two decimal places. MPC = 0.75 MPC = 0.80 Change in Cumulative Spending Increase in Change in Cumulative Spending Cycles during Cycle Spending Spending during Increase in (billions per (billions per Cycle (billions per Spending (billions year) year) year) per year) U A W N - $ 100.00 $ 100.00 $ 75.00 $ 175.00 56.25 $ 231.25 42.18 $ 273.44 S 31.64 $ 305.08 (b) How much more consumption occurs in the first five cycles? 31.08 billion

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