Economics: Principles, Problems, and Policies, 19th Edition

Published by McGraw-Hill Education
ISBN 10: 0073511447
ISBN 13: 978-0-07351-144-3

Chapter 27 - Basic Macroeconomic Relationships - Questions - Page 565: 9

Answer

There is a positive relationship between spending and real GDP. The fractions of the MPS and the MPC determine the size of the multiplier. The MPC is directly related to the multiplier, and the MPS is inversely related.

Work Step by Step

Textbook pages 560 - 562
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