In the Short-Run Keynesian Model, If the Mpc Equals 0

question 74

Multiple Choice

In the short-run Keynesian model, if the mpc equals 0.8, then to decrease planned aggregate spending by $30 billion at any output level, government spending must be decreased by ________ or net taxes must be increased by ________.

• A)$30 billion; $30 billion
• B)more than $30 billion; more than $30 billion
• C)less than $30 billion; less than $30 billion
• D)$30 billion; more than $30 billion

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Definitions:

SMART Goals

Goals that are Specific, Measurable, Achievable, Relevant, and Time-bound, providing clear direction and facilitating goal attainment.

Time Frame

A specified period in which something occurs or is planned to take place.

Terminal Values

End goals or objectives that individuals or organizations aim to achieve, reflecting their core beliefs and ideals.

Milton Rokeach

A psychologist known for his work on human values, attitudes, and belief systems.