Suppose the President Is Successful in Passing a $10 Billion

question 178

Multiple Choice

Suppose the president is successful in passing a $10 billion tax increase.Assume that taxes are fixed,the economy is closed,and the marginal propensity to consume is 0.8.What happens to equilibrium GDP?

• A)There is a $50 billion increase in equilibrium GDP.
• B)There is a $50 billion decrease in equilibrium GDP.
• C)There is a $40 billion increase in equilibrium GDP.
• D)There is a $40 billion decrease in equilibrium GDP.

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Definitions:

Changing Shapes

The process of transformation or alteration in the form or appearance of an object or entity.

Centrality

Refers to the importance or influence of a certain node within a network, highlighting its role in facilitating or hindering the flow of information or resources.

Organizational Subunit

A division or smaller segment within an organization that focuses on specific tasks or goals.

Environmental Uncertainty

The degree of unpredictability and lack of information regarding changes in the external environment that affect an organization's operations.