Suppose that an initial $20 billion increase in investment spending expands GDP by $20 billion in the first round of the multiplier process. If GDP and consumption both rise by $10billion in the second round of the process, what is the MPC in this economy?

Instructions: Round your answer to one decimal place

MPC = $

What is the size of the multiplier?

Instructions: Round your answer to one decimal place

The multiplier = $

If, instead, GDP and consumption both rose by $12 billion in the second round, what would have been the size of the multiplier?

Instructions: Round your answer to one decimal place

The multiplier = $