Question:medium

If the marginal propensity to consume (MPC) is \(0.6\), find the value of the tax multiplier.

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Tax multiplier is always negative: \[ K_T = \frac{-MPC}{1-MPC} \] The negative sign shows the inverse relationship between taxes and income.

Updated On: May 11, 2026

\(0.25\)
\(-0.25\)
\(1.5\)
\(-1.5\)

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The Correct Option is D

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