If the MPC = 0

question 14

Multiple Choice

If the MPC = 0.8 and both government purchases and autonomous net taxes fall by $100 billion, by how much does the equilibrium level of real GDP demanded change (assuming neither income taxes nor net exports exist) ?

• A)-$100 billion
• B)+$100 billion
• C)-$500 billion
• D)+$500 billion
• E)+$200 billion

---

Definitions:

Reconstructs

To build or form something again after it has been damaged or destroyed, often used in the context of surgery or historical restoration.

Computer

An electronic device capable of processing data according to a set of instructions, used for tasks ranging from basic calculations to complex computations and communications.

Endoscopic Procedure

A minimally invasive medical procedure using an endoscope to examine the interior of a bodily organ or space.

Arthroscopy

A minimally invasive surgical procedure on a joint in which an examination and sometimes treatment of damage is performed using an arthroscope.