If Government Spending Increased by $100 Billion and the MPS

question 24

Multiple Choice

If government spending increased by $100 billion and the MPS within the economy was 0.25, what would be the total impact on real GDP?

• A)​$25 billion increase
• B)​$75 billion increase
• C)​$133 billion increase
• D)​$400 billion increase

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Definitions:

Retail Products

Goods or merchandise sold in small quantities directly to consumers, often through stores or online platforms.

Encryption

Encoding data or information into a cipher to prevent access by unauthorized users.

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A digital form of identification that uses cryptographic keys to validate the identity of individuals or devices online.

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A visual symbol commonly used on digital platforms to indicate that a file, folder, or connection is secure or encrypted.