If the mpc is .8 and there is a $10 million increase in investment spending, then the aggregate demand curve will shift up and to the right by:
a) $50 million.
b) $12.5 million.
c) $8 million.
d) $2 million.

Option (A) is correct.

Explanation:

Given that,

Marginal propensity to consume (MPC) = 0.8

Increase in investment spending = $10 million

Marginal propensity to save (MPS) = 1 - MPC

                                                         = 1 - 0.8

                                                         = 0.2

Spending multiplier =

                                 =

                                 = $50 million

Therefore, If the MPC is .8 and there is a $10 million increase in investment spending, then the aggregate demand curve will shift up and to the right by $50 million.

answer: nobody

explanation:

two years ago, when picking flowers in the mountains back of yosemite valley, i found a book. it was blotted and storm-beaten; all of its outer pages were mealy and crumbly. the paper seemed to dissolve like the snow beneath which it had been buried, however; many of the inner pages were well preserved. and although all were more or less stained and torn, whole chapters were easily readable. this is the condition of the great open book of yosemite glaciers today; its granite pages have been torn and blurred by the same storms that wasted the castaway book.

two years ago, when picking flowers in the mountains back of yosemite valley; i found a book. it was blotted and storm-beaten, all of its outer pages were mealy and crumbly. the paper seemed to dissolve like the snow beneath which it had been buried, however, many of the inner pages were well preserved. and although all were more or less stained and torn; whole chapters were easily readable. this is the condition of the great open book of yosemite glaciers today, its granite pages have been torn and blurred by the same storms that wasted the castaway book.