Calculate the values for each of the questions. assume that in each country there are no taxes, international trade, or inflation and that interest rates are fixed. the italian government decides to stimulate the economy by sending checks worth $70 billion to italian consumers. if the government spending multiplier is 1.5 , calculate the mpc to determine the final change in italy's real gdp due to the transfer. give your answer as a whole number in billions of dollars. $ billion the greek government decides to introduce new austerity measures, which reduce government direct spending by $16 billion. greece has a marginal propensity to consume of 0.6 . what will be the final change in real gdp as a result of this decreased spending? give your answer as a whole number in billions of dollars. $ billion the japanese government decides to stimulate the economy by increasing direct spending by $70 billion. if the final change in real gdp is $280 billion, what is japanese consumers' marginal propensity to consume (mpc)? round your answer to two decimal places. mpc=
the latin word "ceteris paribus," often used in economics simply means, with other things being the same or all things being equal.
the major reason why economics often use "ceteris paribus" is to eliminate other factors which might complicate an outcome.
for instance, if the price of pork increases, people will purchase less pork, that is ceteris parabus. in this instance, ceteris paribus means that the possibility of other factors affecting the sales of pork will not be considered. other factors such as an announcement were made that pork causes cancer, or the price of chicken has increased, thereby making pork the best alternative, hence, all these other factors will not be considered, therefore in this situation, economics only wants to consider what happens if the price of pork rises while keeping all other factors the same.