Comput the following with an explanation how you arrived

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Reference no: EM1357867

Assume that the average American's marginal propensity to consume (MPC)is 1/2, and the American Producers MPC is also 1/2
Caculate the following with an explanation how you arrived at each result:
The Amount Consumers will spend on new consumption.
The amount of new spending from producers.
The Multipler in this case.
The total increase in spending from the primary spending of $400 Million.
Explain the Multipler concept in this case.
What are the qualifications and limitations of the multiplier model?

Reference no: EM1357867

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