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:

Accounting Information

Refers to data related to the financial transactions and status of an organization, useful for decision-making purposes.

Banking Section

A part of financial management systems or software where users can link, view, and manage their bank and credit card transactions.

Write Checks

The act of drafting and signing a check to make a payment from one's bank account to a person or entity.

Chart of Accounts

A systematic listing of all ledger account titles and numbers being used by an organization to track financial transactions and prepare financial statements.