Suppose the consumption function is c 500 billion 0.9y, Ask an Expert

Management Studies

Suppose the consumption function is C = $500 billion + 0.9Y and the government wants to stimulate the economy. By how much will aggregate demand at current prices shift initially (before multiplier effects) with

(a) A $50 billion increase in government purchases?

(b) A $50 billion tax cuts?

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Business Management, Management Studies

Category:- Business Management
Reference No.:- M9102124

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