Suppose That the MPC Is 0

question 294

Multiple Choice

Suppose that the MPC is 0.60; there is no investment accelerator; and there are no crowding-out effects. If government expenditures increase by $25 billion, then aggregate demand

• A)shifts rightward by $62.5 billion.
• B)shifts rightward by $50.0 billion.
• C)shifts rightward by $32.5 billion.
• D)None of the above is correct.

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Definitions:

Optimism

A mental attitude reflecting a belief or hope that the outcome of some specific endeavor, or outcomes in general, will be positive, favorable, and desirable.

Stress Mindset

A person’s belief or attitude towards stress, influencing how they perceive and react to stressful situations.

Behavioral Responses

The actions or reactions of an organism or system in response to stimuli or situations.

Stress-Induced

Refers to effects, responses, or conditions in the body or behavior that are directly caused by or heightened by stress.