--%>
Assignment Help - homework help

Determine sizes of the MPC- the MPS and the multiplier

Refer to the table below in answering the questions which follow:

725_inflationary expenditure gap or recessionary expenditure gap.png

Suppose that investment, net exports and government expenditures do not modify with changes in real GDP, determine the sizes of the MPC, the MPS, and the multiplier?

 

 

E

Expert

Verified

MPC = .8 (= $40 billion/$50 billion); MPS = .2 (= 1 -.8); multiplier = 5 (= 1/.2).

   Related Questions in Finance Basics

  • Q : What is Budget Change Proposal Budget

    Budget Change Proposal (BCP): It is a proposal to modify the level of service or funding sources for activities sanctioned by the Legislature, suggest new program activities not presently authorized, or to remove existing programs.

    Q : Formula for the payment required for a

    Normal 0 false false

    		•
  • Q : Describe Schedule 10 Schedule 10 :

    Schedule 10: (Supplementary Schedule of Appropriations): The Department of Finance control document listing all the appropriations and allocations of funds accessible for expenditure throughout the past, present, and budget years. Such documents are s

    		•
  • Q : Free-rider problem Normal 0 false false

    Normal 0 false false

    		•
  • Q : Define Allocation Allocation : The

    Allocation: The distribution of funds or costs from one account or misuse to one or more accounts or appropriations (example, the allocation of employee compensation funding from the statewide 9800 Budget Act items to the departmental Budget Act items

    		•
  • Q : Define Programs Programs : The

    Programs: The activities of an association grouped on the basis of common objectives. The programs are included of elements that can be further classified into tasks and components.

    		•
  • Q : Describe present value of the firms

    Describe the term "present value of the firm's operations" (also known as Enterprise Value). What does this number expose? The current value of the company's free cash flows reveals the market value of the firm's core income generating operatio

    		•
  • Q : Production at a point outside the

    Normal 0 false false

  • Q : Define Federal Fiscal Year Federal

    Federal Fiscal Year (FFY): The twelve month accounting period of the federal government, starting on October 1 and ending the following September 30. For illustration, a reference to FFY 2013 means the period starting October 1, 2012 and ending at Sep

    		•
  • Q : Compare and contrast the potential

    Normal 0 false false