Suppose That the MPC Out of Disposable Income Was 0

question 27

Multiple Choice

Suppose that the MPC out of disposable income was 0.8 and the marginal tax rate was 0.25 for a given economy.In this case,the value of the tax multiplier in the simple Keynesian model would be

• A)1.
• B)-2.
• C)2.5.
• D)2.
• E)none of the above.

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Definitions:

Occipital Lobe

The region of the cerebral cortex located at the back of the brain, responsible for processing visual information.

Vision

The ability to see, which involves the processing of visual information by the eyes and brain.

Language Production

The process by which thoughts are transformed into spoken or written words.

Left Frontal

Pertains to the left frontal lobe of the brain, which is involved in managing higher cognitive functions such as reasoning, problem-solving, judgment, impulse control, and motor function.