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8 years ago
The King of Rococo hires you as an economic consultant. He is concerned that the output level in Rococo is too high and that this will cause prices to rise. He feels that it is necessary to reduce output by $100 billion. He tells you that the MPC in Rococo is 0.9. Which of the following would be the best advice to give to the King of Rococo?
A) reduce government spending in Rococo by $10 billion
B) reduce government spending in Rococo by $90 billion
C) increase taxes in Rococo by $100 billion
D) increase government spending in Rococo by $100 billion
Textbook 
Principles of Macroeconomics

Principles of Macroeconomics


Edition: 11th
Authors:
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JesslynJesslyn
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NYC Author
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8 years ago
Thanks for answering Slight Smile
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