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

question 146

Multiple Choice

In the short-run Keynesian model, if the mpc equals 0.8, then to decrease 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

---

Definitions:

Sensitive Periods

Times in an individual's development when they are more responsive to certain stimuli and quicker to learn particular skills.

Psychosocial Domain

Relates to the psychological development in the context of a social environment, including the effects of social factors on individual psychological processes.

Siblings

Brothers or sisters; individuals who share one or both parents in common.

Adult Change

Refers to the psychological, emotional, and physical changes that occur in adults due to aging, life experiences, or personal development.