Policy Perspectives From the end of 2013 to the end of 2014, M1 increased from $2,810 billion to $3,010 billion. Instructions: Round your response to one decimal place. a. By what percentage did M1 increase? b. If the Fed had used a fixed rule of 3 percent growth of the money supply, how large would M1 have been in 2014? billion Refer to the News Wire to answer one question. NEWS WIRE FISCAL STIMULUS: GOVERNMENT SPENDING Senate Oks Obama Stimulus Package Washington, D.C.The U.S. Congress gave final approval to President Obama's $787 billion stimulus package yesterday. The $787 billion package is intended to give a boost to the economy, lifting it out of the current recession. At the heart of the package is a half-trillion increase in spending for infrastructure construction, high-speed rail projects, increased unemployment benefits, and scores of other government programs. The package will pump $185 billion into the economy this year and $399 billion next year. Democrats say the plan will save or create 3.5 million jobs. The Senate passed the measure by a vote of 6038 with the support of three Republicans. Earlier, the House passed the bill by a vote of 246183 with no Republican support. Source: News accounts of February 13-15, 2009. If consumers had an MPC of 0.90, by how much would aggregate demand have eventually increased with Obama's spending stimulus, assuming the stimulus was entirely government spending? billion Policy Perspectives From the end of 2013 to the end of 2014, M1 increased from $2,810 billion to $3,010 billion. Instructions: Round your response to one decimal place. a. By what percentage did M1 increase? b. If the Fed had used a fixed rule of 3 percent growth of the money supply, how large would M1 have been in 2014? billion Refer to the News Wire to answer one question. NEWS WIRE FISCAL STIMULUS: GOVERNMENT SPENDING Senate Oks Obama Stimulus Package Washington, D.C.The U.S. Congress gave final approval to President Obama's $787 billion stimulus package yesterday. The $787 billion package is intended to give a boost to the economy, lifting it out of the current recession. At the heart of the package is a half-trillion increase in spending for infrastructure construction, high-speed rail projects, increased unemployment benefits, and scores of other government programs. The package will pump $185 billion into the economy this year and $399 billion next year. Democrats say the plan will save or create 3.5 million jobs. The Senate passed the measure by a vote of 6038 with the support of three Republicans. Earlier, the House passed the bill by a vote of 246183 with no Republican support. Source: News accounts of February 13-15, 2009. If consumers had an MPC of 0.90, by how much would aggregate demand have eventually increased with Obama's spending stimulus, assuming the stimulus was entirely government spending? billion
