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If the marginal propensity to consume (MPC) is 0.75 and if policy makers wish to increase Aggregate Demand by $300 million (shift the AD curve

If the marginal propensity to consume (MPC) is 0.75 and if policy makers wish

to increase Aggregate Demand by $300 million (shift the AD curve to the right by $300M) to fight a recession, then by how much

would taxes have to change?

a. -300 million

b. -100 million

c. -$30 million

d. -$50 million

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