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In order to financially stimulate the nation, the Federal government injected $900 billion dollars into the economy. However, the results were less than spectacular. One reason could have been a failure to understand the marginal propensity to consume. Assume the marginal propensity to consume (MPC) was only 0.4. How much of that $900 billion went to increased consumption? Where did the rest of the money go?
Increased consumption: ________________________
Where did the rest go? _________________________
Using MPC = 0.4, what is the spending multiplier (the actual numerical value please):
What was the overall change in income as a result of the stimulus package after the multiplier completely works its way through the economy?
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Take into account the due dates. Prevent plagio. Late assignments have a penalty of two points. Submit assignments as attachment for easier correction.
In current decades, women have worked more hours in paid jobs also fewer hours in up paid housework.
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