If the Marginal Propensity to Consume Is 0

question 133

Multiple Choice

If the marginal propensity to consume is 0.75 and taxes increase by $30 billion, real GDP will:

• A)increase by exactly $30 billion.
• B)decrease by exactly $30 billion.
• C)decrease by less than $120 billion.
• D)decrease by more than $120 billion.

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Definitions:

Win-lose

A negotiation or conflict resolution outcome where one party's gain is equivalent to another party's loss, creating a competitive and adversarial scenario.

Integrative Negotiations

A negotiation approach aimed at finding mutually beneficial solutions by addressing the interests and needs of all parties involved.

Labor Unions

Organizations that represent the collective interests of workers in negotiations with employers about wages, working conditions, and benefits.

Distributive Negotiations

A bargaining scenario where parties perceive that there is a fixed amount of value to be divided, often leading to competitive or win-lose negotiating strategies.