Mathematically, the value of the tax multiplier in terms of the marginal propensity to consume (MPC) ...

Mathematically, the value of the tax multiplier in terms of the marginal propensity to consume (MPC) is given by the formula:
a. MPC 1.
b. (MPC 1) / MPC.
c. 1 / MPC.
d. 1 1 / (1 MPC).

QUESTION 2

The equation specifying a direct relationship between the money supply and prices is the quantity theory of:
a. money.
b. prices.
c. exchange.
d. spending.
e. dollars.

QUESTION 3

When an economy is operating at its full employment rate of output:
a. the rate of unemployment will be zero.
b. output will exceed the economy's maximum sustainable rate.
c. the actual rate of unemployment will equal the natural rate.
d. the economy's potential rate of output will exceed actual GDP.

QUESTION 4

If the marginal propensity to consume = 0.75, then:
a. the marginal propensity to save = 0.75.
b. the marginal propensity to save = 1.33.
c. the marginal propensity to save = 0.20.
d. the marginal propensity to save = 0.25.
e. since the marginal propensity to save and the marginal propensity to consume are unrelated, we cannot determine the marginal propensity to save from the information given.

QUESTION 5

If V = 5, P = 100, and Q = 10, then M is:
a. 20.
b. 10.
c. 500.
d. 1,000.
e. 200.

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Mathematically, the value of the tax multiplier in terms of the marginal propensity to consume (MPC) ...

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