For a Marginal Propensity to Consume of 0

question 55

Multiple Choice

For a marginal propensity to consume of 0.9, the multiplier effect of an increase of $100 billion in government purchases of goods and services is larger than the multiplier effect of a tax cut of $100 billion because:

• A)the government pays a higher price than households for the same goods and services.
• B)production of the goods and services the government purchases has a bigger impact on real GDP than production of consumer goods.
• C)many households fail to file their income tax and claim their refund.
• D)in the first round of spending only $90 billion of the tax cut will be spent and $10 billion will be saved, while the entire $100 billion of government purchases will be spent.

Understand the cost implications and financial planning considerations for replacing homemakers' services.

Demonstrate knowledge of the steps involved in life insurance planning, including requirement estimation and objective definition.

Identify and differentiate between different types of life insurance policies and companies.

Apply specific methods for calculating life insurance needs based on family and financial situations.

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Definitions:

Job Title

A job title is an official name or designation assigned to a position based on the role and responsibilities it entails.

Phone Number

A series of digits assigned to a specific telephone line for the purpose of making and receiving calls.

Email Client

Software used to access and manage a user's email, allowing them to send, receive, and organize messages.

Compose

The act of creating a written piece, such as an email or a document.