If the MPC is 0.5 and the government increases spending by $250 billion, which of the following will be the effect this change has on the economy?

The economy will increaseby $125 billion.

The economy will increase by $250 billion.

The economy will increase by $500 billion.

The economy will increase by $350 billion.

Second Question is:

A(n) __________ is a system where banks in the United States eventually figured out that they could print more __________ than the gold that they had in their vaults.

open market operation;fiduciary currency

fractional reserve;paper money

fractional reserve;fiduciary currency

open market operation;paper money

Thank you in advance!