McqMate

Q. |
## In the simple Keynesian model, if the tax function is given by T=0.15Y and the consumption function is C= 50 + 0.7 YD then a 10-unit ncrease in government spending would increase equilibrium income by |

A. | 10 units |

B. | 11.2 units |

C. | 22.4 units |

D. | 30 units |

Answer» B. 11.2 units |

698

0

Do you find this helpful?

3

View all MCQs in

Managerial EconomicsNo comments yet

- Suppose that the MPC out of disposable income was 0.8 and the tax function for a given economy was T= -30+0.25Y. an increase in the intercept of the tax function of 10 units(from -30 to -20 would cause equilibrium income in the simple Keynesian model to fall by
- Suppose that the MPC out of disposable income was 0.8 and the marginal tax rate was 0.25 for a given economy. In this case, the value of the tax multiplier in the simple Keynesian model would be
- If the tax function is given by T= -20+0.1 Y the average tax rate would
- If the tax function is T= t0+t1y where t1 equals 1/3,and if the marginal propensity to consume out of disposable income is 3/4 , then the change in GDP oer unit change into t0 (∆Y/∆ t0) will be
- According to the Keynesian model, the optimal fiscal policy is to
- In real business cycle models, business cycles are caused by ------------------,while in new Keynesian model business cycles are caused by-------------------
- New Keynesian would agree with all of the following except
- From the net tax function: T=t0+t1Y,where t0<0 and t1>0, it follows that, as income rises
- Assuming a simultaneous deduction in income taxes and transfer payments of $50 billion, then aggregate disposable income will
- The income consumption curve generally?