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If the Marginal Propensity to Consume Is 0

question 51

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If the marginal propensity to consume is 0.75 and autonomous consumption spending will decrease by $30 billion,by how much would net taxes need to decrease in order to have no change in output? (Ignore any timing issues. )


Definitions:

Risk of Fatality

The probability or likelihood of death resulting from exposure to a hazard or undertaking a certain activity.

Value of Human Life

An economic value assigned to a human life based on factors like income potential, costs, and benefits in a given context, often used in public policy and insurance.

Value of Human Life

The economic or ethical worth assigned to a human life, used in legal and policy-making decisions to assess the cost versus benefits of actions that could impact human mortality.

Voluntary Risks

Risks that individuals knowingly and willingly expose themselves to in pursuit of a benefit or for personal reasons.

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