If the marginal propensity to consume is 0.6, what is the long-run expenditure multiplier?

If the government uses fiscal policy to close a recessionary gap, government

A) expenditure must be increased by more than the gap because of the government expenditure multiplier. B) taxes must be cut by more than the gap because of the tax multiplier. C) expenditure can be increased by less than the gap because of the government expenditure multiplier. D) taxes can be raised by less than the gap because of the tax multiplier. E) taxes must be raised by more than the gap because of the tax multiplier.

As a source of bank funds, __________ has fallen by nearly two-thirds in relative importance since 1970

A) time deposits B) transactions deposits C) savings deposits D) equity