Norder to financially stimulate the nation, the federal government injected $900 billion dollars into the economy. however, the results were less than spectacular. one reason could have been a failure to understand the marginal propensity to consume. assume the marginal propensity to consume (mpc) was only 0.4. how much of that $900 billion went to increased consumption? where did the rest of the money go?

increased consumption:

where did the rest go?

using mpc = 0.4, what is the spending multiplier (the actual numerical value ):



what was the implied change in income as a result of the stimulus package?