Question
When the marginal propensity to save is 0.4, the government decides to decrease the tax rates by $100 billion. What is the maximum impact on
When the marginal propensity to save is 0.4, the government decides to decrease the tax rates by $100 billion. What is the maximum impact on real GDP?
It will increase by as much as $150 billion.
It will increase by as much as $100 billion.
It will decrease by as much as $150 billion.
It will decrease by as much as $250 billion.
It will increase by as much as $250 billion.
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Introduction to Econometrics
Authors: James H. Stock, Mark W. Watson
3rd edition
133595420, 978-0138009007, 138009007, 978-0133486872, 133486877, 978-0133595420
