Suppose an Economy's Marginal Propensity to Consume (MPC)is 0

question 61

Multiple Choice

Suppose an economy's marginal propensity to consume (MPC) is 0.6.Then

• A)1 + MPC + MPC ² + MPC ³ = 1.844 and,if we continued adding up terms in this geometric series,we would get closer and closer to the multiplier value of 1.96.
• B)1 + MPC + MPC ² + MPC ³ = 1.844 and,if we continued adding up terms in this geometric series,we would get closer and closer to the multiplier value of 3.
• C)1 + MPC + MPC ² + MPC ³ = 2.176 and,if we continued adding up terms in this geometric series,we would get closer and closer to the multiplier value of 3.
• D)1 + MPC + MPC ² + MPC ³ = 2.176 and,if we continued adding up terms in this geometric series,we would get closer and closer to the multiplier value of 2.5.

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Definitions:

Broad Domes

Broad domes refer to large, rounded structures on the Earth's surface, often created by the slow uplift of the underlying strata.

Extension

The process or state of increasing in length, area, or volume, often referred to in geology as the stretching and thinning of the Earth's crust.

Subduction Zone

A region of the Earth's crust where one tectonic plate moves under another, leading to volcanic activity and earthquakes.

Arc

A continuous portion of a circle or other curved line, or in geological terms, a curved series of volcanic islands that form above a subducting plate.