Macroeconomics

The Whereami County government has cut its spending by $4 5 million and raised taxes on County residents by $3 5

Question

The Whereami County government has cut its spending by $4.5 million and raised taxes on County residents by $3.5

million in order to close a growing budget deficit. If the local marginal propensity to consume is 0.9, by how much has local GDP decreased because of these changes to government spending and taxes?

Macroeconomics

Back To Top