An Increase in Government Spending by $100 Would, If the MPC

question 197

Multiple Choice

An increase in government spending by $100 would, if the MPC = 0.90, result in an increase in real GDP by:

• A) $1,000.
• B) $9,000.
• C) $900.
• D) $190.
• E) inadequate information is given.

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Definitions:

Order Fulfillment Department

The division of a company responsible for processing and delivering orders to customers.

Unused Capacity

The portion of a company's production capability that is not being utilized at a given time.

Capacity Analysis

Capacity analysis is the assessment of the maximum output level that an organization can sustainably achieve within a given period.

Time-Driven Activity-Based Costing

An accounting method that assigns costs to products based on the estimated time and resources required for activities.