19. If your disposable income increases from $10,000 to $15,000 and your consump

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19. If your disposable income increases from $10,000 to $15,000 and your consumption increases from $9,000 to $12,000, your MPC is: (Points : 2) 0.2. 0.4. 0.6. 0.8. 20. Suppose the government increases its spending by $100 billion as a stimulus package. If the MPC is 0.6, then equilibrium income will: (Points : 2) decrease by $250 billion. increase by $250 billion. increase by $600 billion. decrease by $400 billion. 21. Consumer spending in the United States normally accounts for approximately ______ of the economy. (Points : 2) 1/3. 1/2. 2/3. 3/4. 22. David receives a tax refund of $800. He spends $600 and saves $200. David's marginal propensity to consume is: (Points : 2) 0.6. 0.75. 0.25. 0.20. 23. If the disposable income increases, then: (Points : 2) the consumption function will shift upwards. there will be a rightward movement along the consumption function. there will be a leftward movement along the consumption function. the consumption function will shift downwards. 24. Suppose the marginal propensity to consume is equal to 0.90 and investment spending increases by $50 billion. Assuming no taxes and no trade, by how much will real GDP change? (Points : 2) $450 billion increase $90 billion increase $500 billion increase $500 billion decrease 25. When David has no income, he spends $500. If his income increases to $2,000, he spends $1,900. Which of the following represents his consumption function? (Points : 2) C = 1.2

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43 b

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