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Suppose the MPC = 0.90 instead of 0.80. Investment spending rises by 1000. Fill out the following table: Change in Spending Change in Income Round
Suppose the MPC = 0.90 instead of 0.80. Investment spending rises by 1000. Fill out the following table: Change in Spending Change in Income Round 1 1000 1000 Round 2 900 Round 3 810 Round 4 729 Hint: What is the relationship between my spending and your income? The first line of the table is completed for you. 1. How much is spent out of each new dollar? 2. What is the multiplier now
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Managerial Economics and Strategy
Authors: Jeffrey M. Perloff, James A. Brander
1st edition
978-0137036059, 133379094, 321566440, 137036051, 9780133379099, 978-0321566447
