If the Marginal Propensity to Consume Is 0

question 79

Multiple Choice

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

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

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Definitions:

Genetics

The branch of biology that deals with heredity and the variation of inherited characteristics.

Ethnic Background

Refers to an individual's cultural heritage, including nationality, culture, ancestry, and language.

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A form of alcohol dependence characterized by a later onset, often associated with genetic factors and a strong genetic predisposition.

Cocaine

A powerful stimulant drug derived from the leaves of the coca plant that affects the central nervous system, leading to increased energy and euphoria.