Assume That the MPC Is 0

question 98

Multiple Choice

Assume that the MPC is 0.9 and investment falls by $30 billion.What is the change in real GDP?

• A)−$300 billion
• B)−$270 billion
• C)−$93 billion
• D)−$39 billion

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Definitions:

Nondiscriminating Monopolist

A monopolist who charges all consumers the same price for a good or service, regardless of the demand or cost conditions.

Demand Schedule

A table that shows the quantity of a good or service demanded at various prices.

Nondiscriminating Monopolist's Demand Curve

The demand curve faced by a monopolist who charges the same price to all customers, reflecting the total market demand for its product.

Average Revenue

Average revenue is the amount of turnover a company generates per unit of product sold, calculated by dividing total revenue by the number of units sold.