In the Short-Run Keynesian Model Where the Marginal Propensity to Consume

question 73

Multiple Choice

In the short-run Keynesian model where the marginal propensity to consume is 0.75, to offset a recessionary gap resulting from a $1 billion decrease in autonomous consumption, taxes must be:

• A)increased by $1 billion.
• B)decreased by $1 billion.
• C)increased by $1.33 billion.
• D)decreased by $1.33 billion.

---

Definitions:

File Workup Memo

A document prepared in legal settings, summarizing a case's facts, relevant law, and strategic considerations for use by attorneys.

Paralegal

A trained individual who assists attorneys in the delivery of legal services, performing tasks such as research and document preparation but not authorized to practice law.

Civil Jury Trial

A legal proceeding wherein a group of citizens (the jury) determines the outcome of a dispute between parties in a civil case.

Amendment

A modification or change made to a document, law, constitution, or agreement.