Which of the Following Best Describes the Impact of the MPC

question 97

Multiple Choice

Which of the following best describes the impact of the MPC on AD?

• A)the greater the MPC, the greater the change in government purchases required to achieve a given change in AD
• B)the greater the MPC, the smaller the fraction of an increase in AD due to an increase in government purchases that is consumption
• C)the smaller the MPC, the greater the fraction of an increase in AD due to an increase in government purchases that is consumption
• D)the smaller the MPC, the greater the change in government purchases required to achieve a given change in AD

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Definitions:

Electrons

Subatomic particles with a negative charge, orbiting the nucleus of an atom.

Charged Atom

A charged atom, also known as an ion, is an atom that has gained or lost one or more electrons, resulting in a positive or negative charge.

Solution

Uniform mixture of solute completely dissolved in solvent.