Suppose that Omar’s marginal utility for cups of coffee is constant at 1.5 utils per cup no matter how many cups he drinks.
September 3, 2020
PART C: Long Questions Long Question 1: (20 points) Consider the short run mode] of Chapters 11 and 12. The national income identity is given by…
September 3, 2020

Assume the simple spending multiplier equals 10.  Determine the size and direction of any shifts in the aggregate expenditure line, the level of real GDP demanded, and the aggregate demand curve for each of the following changes in autonomous spending:a. Autonomous spending rises by $8 billion. b. Autonomous spending falls by $5 billion.c. Autonomous spending rises by $20 billion.

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