The Following Information Is for a Closed Economy Refer to the Information

question 138

Multiple Choice

The following information is for a closed economy: $\begin{array}{c}\begin{array}{c}\underline{\text { GDP }} \\\$ 100 \\200 \\300 \\400 \\500 \\600 \\700\end{array}\begin{array}{c}\underline{\text { C }}\\ \$ 100 \\160 \\220 \\280 \\340 \\400 \\460 \end{array}\begin{array}{c}\underline{\text { S}} \\\$ 0 \\40 \\80 \\120 \\160 \\200 \\240 \end{array}\begin{array}{c}I_{g} \\\hline \$ 80 \\80 \\80 \\80 \\80 \\80 \\80 \end{array}\end{array}$
Refer to the information.The addition of a $100 billion lump-sum tax:

• A) reduces the MPC and increases the multiplier.
• B) increases the MPC and decreases the multiplier.
• C) increases both the MPC and the multiplier.
• D) has no effect on either the MPC or the multiplier.

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Definitions:

Highly Transparent

Refers to an environment, system, or organization where there is easy access to complete information, thereby facilitating openness and communication.

Accurate

Characterized by exactness and precision; free from errors or mistakes.

Reliable

In the context of information or data, reliable refers to the consistency and dependability of the information over time, indicating its trustworthiness or accuracy.

Accounting Information

Data related to the financial transactions and status of an organization, used for analysis, decision-making, and compliance.