Question

if the MCP in an economy is 0.75, government could shift the aggregate demand curve leftward...

if the MCP in an economy is 0.75, government could shift the aggregate demand curve leftward by $60 billion by increasing taxes by? answer is in billion. please explain

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Given:

Thus, the government could shift the aggregate demand curve leftward by $60 billion by increasing taxes by $20 billion

In Case of any query, feel free to comment

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
If the MPS in an economy is .4, government could shift the aggregate demand curve leftward...
If the MPS in an economy is .4, government could shift the aggregate demand curve leftward by $30 billion by: A) reducing government expenditures by $125 billion. B) reducing government expenditures by $20 billion. C) increasing taxes by $50 billion. D) increasing taxes by $250 billion.
If the MPC in an economy is .8, government could shift the aggregate demand curve rightward...
If the MPC in an economy is .8, government could shift the aggregate demand curve rightward by $100 billion by: decreasing taxes by $25 billion. increasing government spending by $25 billion. increasing government spending by $80 billion. decreasing taxes by $100 billion.
An increase in government purchases of $100 billion will shift the aggregate-demand curve to the: A....
An increase in government purchases of $100 billion will shift the aggregate-demand curve to the: A. right by more or less than $100 billion B. left by more or less than $100 billion C. left by more than $100 billion D. right by more than $100 billion
Assume that a hypothetical economy with an MPC of 0.75 is experiencing a severe recession. a....
Assume that a hypothetical economy with an MPC of 0.75 is experiencing a severe recession. a. By how much would government spending have to rise to shift the aggregate demand curve rightward by $25 billion? Instructions: Round your answer to two decimal places. $  billion b. How large a tax cut would be needed to achieve the same increase in aggregate demand? Instructions: Round your answer to two decimal places. Enter a positive value. $  billion c. Determine one possible combination of...
Discuss the three ranges of the aggregate supply (AS) curve. What could cause the AS curve...
Discuss the three ranges of the aggregate supply (AS) curve. What could cause the AS curve to shift to the left? What impact would a leftward shift of the AS curve have on the economy?
Assume that the MPC is .8 in an economy that has an aggregate supply curve with...
Assume that the MPC is .8 in an economy that has an aggregate supply curve with a slope of 1. Also, suppose that the price level is flexible downward. A decrease in investment spending of $10 billion will shift the aggregate demand curve leftward by: (Show Steps) A. $50 billion and decrease real GDP by $50 billion. B. $50 billion and decrease real GDP by $25 billion.100% C. $10 billion and decrease real GDP by $10 billion.    D. $10 billion...
hiii!! could you please explain why decrease in aggregate demand will shift demand for laonable fund...
hiii!! could you please explain why decrease in aggregate demand will shift demand for laonable fund curve to the left (supply for loanable fund to the right) ??? thanksss
In an aggregate demand-aggregate supply diagram, equal decreases in government spending and taxes will Group of...
In an aggregate demand-aggregate supply diagram, equal decreases in government spending and taxes will Group of answer choices not affect the AD curve. increase the equilibrium GDP. shift the AD curve to the left. shift the AD curve to the right.
3) Which of the following occurs as the economy moves leftward along a given IS curve?...
3) Which of the following occurs as the economy moves leftward along a given IS curve? A) An increase in the interest rate causes investment spending to decrease. B) An increase in the interest rate causes money demand to increase. C) An increase in the interest rate causes a reduction in the money supply. D) A reduction in government spending causes a reduction in demand for goods. E) An increase in taxes causes a reduction in demand for goods. 5)...
If businesses are optimistic about future sales, the short-run aggregate supply curve will shift leftward. True...
If businesses are optimistic about future sales, the short-run aggregate supply curve will shift leftward. True False
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT