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Suppose that consumers have an average MPC of 0.75. However, 20% of their income goes to...

Suppose that consumers have an average MPC of 0.75. However, 20% of their income goes to the government in the form of taxes. Furthermore, 25% of disposable income is spent on foreign goods and services rather than domestic goods.

Suppose that the government consumes $750 billion, investment is $500 billion, and exports are $250 billion. Autonomous consumption is also $500 billion.

How large is the expenditure multiplier?

(round to 2 decimal places)

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