Respuesta :
Answer:
correct answer is option c i.e $12 billion
Explanation:
consumption reduced by $ 36 billion
marginal propensity to consume (MPC) = 0.75
Tax should be increased by
= \frac{36}{0.75}
= 48 billion( total income (Y) )
max tax can be taken = Y- C
=48-36
=$12 billion
therefore correct answer is option c
Answer:
The correct answer to this question is c) $12 million.
Explanation:
For taking out the amount by which government should raise taxes can be taken out by subtracting the consumption from the total income.
Given information -
Consumption reduced by - $36 billion
MPC - .75
Now with the help of given information we can take out the total income as -
Consumption / MPC
= $36 billion / .75
= $48 billion
Now Taxes raised should be = Total income - Consumption
= $48 - $36 ( billions )
= $12 billions
