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Unformatted text preview: (^*-^-r C) less than equilibrium and will decreases away from equilibrium. D) greater than equilibrium and will remain constant. E) greater than equilibrium and will decrease toward equilibrium. 19) Suppose G = 300 and the income-tax rate is 30 percent. The government budget is in surplus foi 19) only those incomes A) less than 350. / OTn ^ />> * 3&V B) less than 1 000. C) greater than 1 000. D) greater than 2 500. E) greater than 3 000. 7 /"^% 1 - f^ I N ( ~~~ Vj/ 1 T. -\J V ^^~ * 20) If the marginal propensity to spend is 0.5, and the MPC is 0.7, a $1 billion reduction in government purchases will cause equilibrium national income to by . A) decrease; $2.00 billion B) decrease; $1.50 billion C) increase; $2.00 billion D) increase; $3.33 billion E) decrease; $3.33 billion C...
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This note was uploaded on 01/15/2012 for the course ECON 104 taught by Professor Peter during the Summer '09 term at Camosun College.
- Summer '09