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

question 72

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:

Increasing Uncertainty

The situation in which the amount of unpredictability in the environment or the future outcomes of decisions is rising.

Managerial Experience

The accumulation of knowledge, skills, and expertise that an individual has acquired through holding managerial positions over time.

Managerial Experience

The accumulation of knowledge, skills, and insights gained through holding positions of responsibility for directing and controlling organizational units or projects.

Perceived Environment

Refers to how individuals interpret and understand the environments in which they find themselves, through subjective perception.