the value of the marginal propensity to consume is .8. If real gdpincreases by $30 billionthis situation was the result of an increase in the aggregative expenditures schedule of?
To determine the increase in the aggregate expenditures schedule, we can use the concept of the marginal propensity to consume (MPC).
The MPC represents the proportion of additional income that is spent on consumption. In this case, the given value of the marginal propensity to consume is 0.8, which means that 80% of any increase in income is spent on consumption.
To calculate the increase in the aggregate expenditures schedule, we need to find the amount of the increase in consumption resulting from the $30 billion increase in real GDP.
First, we calculate the increase in consumption by multiplying the increase in GDP by the marginal propensity to consume:
Increase in consumption = Increase in GDP * Marginal Propensity to Consume
= $30 billion * 0.8
= $24 billion
Therefore, the increase in the aggregate expenditures schedule is $24 billion.