Question
What would happen to U.S. GDP if the Marginal Propensity to Consume (MPC) fell from .95 to .75 in the Keynesian formula shown above? A)
What would happen to U.S. GDP if the Marginal Propensity to Consume (MPC) fell
from .95 to .75 in the Keynesian formula shown above?
A) It can't change because the MPC is stays constant and is always a fixed percentage.
B) The U.S. economy would slow down and this also might start a new recession.
C) This would be great news! It would cause the U.S. economy to increase.
D) We simply don't know - the Keynesian theory is not yet fully developed
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The End Of Poverty Economic Possibilities For Our Time
Authors: Jeffrey D Sachs, Bono
1st Edition
0143036580, 9780143036586
