Business, 03.11.2020 19:50 azaz1819

Suppose economists observe that an increase in government spending of $12 billion raises the total demand for goods and services by $48 billion. If these economists ignore the possibility of crowding out, they would estimate the marginal propensity to consume (MPC) to be _.
a.) 1/4
b.) 3/4
c.) 4

Now suppose the economists allow for crowding out.
Their new estimate of the MPC would be_than their initial one.
a.) smaller
b.) larger

PLEASE HELP, I NEED TO GET THIS RIGHT.

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