Assume That the MPC Is 0

question 134

Multiple Choice

Assume that the MPC is 0.80 and investment rises by $50 million.How much additional saving will this generate in the second round of spending?

• A)$10 million
• B)$40 million
• C)$50 million
• D)$62.5 million
• E)$250 million

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Definitions:

Blank Slate

The idea that individuals are born without built-in mental content, and all knowledge comes from experience or perception, also known as tabula rasa.

Nativists

Proponents of the theory that certain skills or abilities are innate and not acquired through learning or experience.

Inborn Characteristics

Traits or features present from birth, often considered to be genetically inherited or biologically determined.

Psychologists

Professionals who study cognitive, emotional, and social processes and behavior by observing, interpreting, and recording how individuals relate to one another and their environments.