If the Marginal Propensity to Save (MPS) in a Closed

question 66

Multiple Choice

If the marginal propensity to save (MPS) in a closed economy is 0.02 and the marginal propensity to tax (MPT) is 0.06, what is the value of the multiplier?

• A) 6
• B) 10.5
• C) 8.5
• D) 12.5

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Definitions:

Pressure Flow Theory

A hypothesis explaining how sugars are moved from the leaves where they're produced to other parts of the plant through phloem.

Parenchyma

In plants, simple tissue composed of living, thin-walled cells; has various specialized functions such as photosynthesis.

Xylem

The vascular tissue in plants that conducts water and dissolved nutrients upwards from the root and also helps to form the woody element in the stem.

Phloem

A type of vascular tissue in plants responsible for transporting sugar, nutrients, and signals throughout the plant.