Suppose the MPC Is 0

question 96

Multiple Choice

Suppose the MPC is 0.75, and net taxes decrease by $100 billion.By what amount will the equilibrium level of real GDP increase?  

• A) by $75 billion 
• B) by $100 billion 
• C) by $300 billion 
• D) by $400 billion

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Definitions:

Exclusive

Pertaining to a unique right or privilege held by an entity, preventing others from sharing the same.

Discrete Random Variable

A variable that takes on a countable number of distinct and separate values, often resulting from a counting process.

Outcomes

The results or consequences of actions or experiments that can be measured or observed.

Continuous Intervals

Ranges in mathematics and statistics without any breaks or discrete jumps, often used in calculations involving real numbers.