If the Marginal Propensity to Consume Is 0

question 51

Multiple Choice

If the marginal propensity to consume is 0.75 and autonomous consumption spending will decrease by $30 billion,by how much would net taxes need to decrease in order to have no change in output? (Ignore any timing issues. )

• A) $60 billion
• B) $30 billion
• C) $90 billion
• D) $120 billion
• E) $40 billion

Assess risks associated with various substances and their acute physiological impacts.

Identify withdrawal symptoms and appropriate responses to different substances.

Understand the implications of stock dividends on common stock, retained earnings, and additional paid-in capital.

Calculate dividends paid to preferred and common stockholders under different scenarios.

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Definitions:

Book Values

The net value of a company's assets, as recorded in its financial statements, minus its liabilities and intangible assets.

Market Value

The estimated amount for which an asset or company could be sold on the open market.

Retention Ratio

The portion of a company's earnings that is not distributed as dividends but is retained by the business for reinvestment.

Retained Earnings

The portion of a company’s net profits that are kept within the company instead of being paid out to shareholders as dividends.