Suppose the government increases expenditures

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1) Suppose the government increases expenditures by ?100 billion and the marginal propensity to consume is 0.50. By how will equilibrium GDP? change?

The change in equilibrium GDP? is: ?$ billion. (Round your solution to one decimal? place.)

2) Suppose you deposit ?$ 2,000 cash into your checking account. By how much will checking deposits in the banking system increase as a result when the required reserve ratio is 04?0 The change in checking deposits is equal? to: ?$

?(enter your result rounded to the nearest dollar?).

Reference no: EM131668617

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