Question
Suppose a small economy has consumption spending of $6,500 when its income is $10,000. When income goes up to $11,000 then consumption spending is $7,250.
Suppose a small economy has consumption spending of $6,500 when its income is $10,000. When income goes up to $11,000 then consumption spending is $7,250. What is the government spending multiplier in this economy? (Hint: Find the MPC first, then calculate the multiplier.)
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To find the government spending multiplier in this economy we first need to calculate ...
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Core Macroeconomics
Authors: Eric Chiang
3rd edition
978-1429278478, 1429278471, 978-1429278492, 1429278498, 1464191433, 978-1464191435
