Consider a Simple Macro Model with a Constant Price Level

question 21

Multiple Choice

Consider a simple macro model with a constant price level and demand-determined output.The marginal propensity to spend out of national income,z,can be expressed as ________ (where t = net tax rate and m = marginal propensity to import) .

• A)z = MPC(1 - t - m)
• B)z = tY - mY
• C)z = MPC - (1 - t- m)Y
• D)z = MPC - (1 - t - m)
• E)z = MPC(1 - t)- m

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Definitions:

Stock Exchange

Stock Exchange is a regulated marketplace where securities, such as stocks and bonds, are bought and sold by participants.

Listing

The act of registering a company's shares on a stock exchange, enabling public trading.

Free Advertising

Marketing exposure a company gains without incurring any direct expense, often through word-of-mouth or viral content.

Household Wealth

The net value of all assets owned by members of a household, including property, investments, and cash, minus liabilities.