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6. For each of the following cases, calculate the spending multiplier and find the direction and size of the shift in the AD curve: a.

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6. For each of the following cases, calculate the spending multiplier and find the direction and size of the shift in the AD curve: a. Government purchases increase by $2 billion in an economy with an MPW of 0.65. b. Government purchases decrease by $5 billion in an economy with an MPC of 0.45. c. A $3 billion tax rise occurs in an economy with an MPW of 0.7. d. A $4 billion tax cut causes an initial $1.5 billion increase in spending on domes- tic items

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