Suppose the Marginal Propensity to Consume Equals

question 54

Multiple Choice

Suppose the marginal propensity to consume equals .8 (i.e.,c₁ = .8) .Given this information,which of the following events will cause the largest increase in output?

• A)G increases by 200
• B)T decreases by 200
• C)I increases by 150
• D)both A and B

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Definitions:

Aircraft Manufacturing

The industry focused on the production and assembly of aircraft and their components, including commercial, military, and private planes.

Public Regulation

Public regulation involves government intervention in the market to correct market failures, protect consumers, and achieve social goals.

Industrial Regulation

Governmental policies and laws aimed at controlling or guiding business practices in specific sectors to ensure fair practices, safety, and competition.