Taxes increases 75 billion, Government spending increases 75 billion. The MPC is equal to 2/3.

What is the net change to the GDP?

a. $100 billion

b. $75 billion

c. $33 billion

d. $1 trillion

e. $64 billion.

C = 20 + .6Yd. What is the MPS?

a. 1/3

b. .4

c. .40

d. .2

C = 20 + .8Yd. What is the APS and APC if Yd = 200. Remember, APC = C/Yd.

a. APC = .9 and APS = .1

b. APC = .5 and APS = .5

c. APC = .3 and APS = .3

d. APC = .2 and APS = .8