If the Marginal Propensity to Consume Is

question 20

Multiple Choice

If the marginal propensity to consume is .80 and both taxes and government purchases increase by $50 billion, GDP will:

• A) Increase by $50 billion
• B) Decrease by $50 billion
• C) Increase by $10 billion
• D) Decrease by $10 billion

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Definitions:

Lymphatic Vessels

Part of the lymphatic system, these vessels carry lymph fluid throughout the body, aiding in the removal of toxins and waste.

Digestive Tract

The series of hollow organs joined in a long, twisting tube from the mouth to the anus, where digestion and absorption of food occurs.

Lipids Absorption

The process by which lipids are taken up from the digestive tract into the bloodstream or lymphatic system for use or storage in the body.

Lymphatic System

Part of the immune system, comprising a network of lymphatic vessels that carry a clear fluid called lymph towards the heart.