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I need to find out the impact on real GDP using the MPE formula, (1-aver. tax rate)*mpc-mpi, help me please...?


Assume the marginal propensity to consume is 60 percent, the average tax rate is 30percent, and the marginal propensity to import is 15 percent. Suppose the government decreases its purchases of goods and services by $3 billion. what will be the impact on real GDP?
I found the MPE and Multiplier but I don't know if I should multiply $3 billion with it or divide to show the impact on real GDP.

538 day(s) ago

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Question Title I need to find out the impact on real GDP using the MPE formula, (1-aver. tax rate)*mpc-mpi, help me please...?
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