How do the marginal propensity to consume, the marginal propensity to import, and the income tax rate influence the multiplier?
What will be an ideal response?
The marginal propensity to consume, the marginal propensity to import, and the income tax rate all influence the magnitude of the multiplier. The multiplier is smaller when the marginal propensity to consume is smaller, when the marginal propensity to import is larger, and when the income tax rate is larger.
Economics
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What are the three cases for the price elasticity of demand? Briefly define each
What will be an ideal response?
Economics
Refer to Figure 16-5. Suppose the firm represented in the diagram decides to use a two-part pricing strategy such that it charges a fixed fee and a per-unit price equal to the monopoly price. What is the profit earned under this pricing scheme?
A) $5,760 B) $6,400 C) $7,680 D) $7,870
Economics