Assume That the MPC Is 0

question 54

Multiple Choice

Assume that the MPC is 0.8. If government purchases increase by $500, equilibrium output ________; and if taxes increase by $500, equilibrium output ________.

• A) increases by $2,500; decreases by $2,000
• B) increases by $4,000; decreases by $3,000
• C) increases by $2,000; decreases by $1,000
• D) increases by $1,600; decreases by $1,200

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Definitions:

Child Abuse

Any action by another person – adult or child – that causes significant harm to a child, including physical, sexual, emotional harm, or neglect.

Malpractice

Professional misconduct or failure to provide adequate services, leading to harm, loss, or damage, often seen in medical, legal, and other professional fields.

Professional Honesty

The ethical principle requiring individuals to be truthful and transparent in their professional dealings, ensuring fairness and integrity.

Informed Consent

The process by which an individual is fully informed about the procedures and risks involved in a particular action or decision, agreeing to it without any coercion.