Assume the marginal propensity to consume is 0.8 and potential output is $800 billion. if actual real gdp is $700 billion, which of the following policies would bring the economy to potential output? a. decrease taxes by $25 billion.
b. decrease government transfers by $25 billion.
c. decrease taxes by $100 billion.
d. increase taxes by $100 billion.

Joint cost cheyenne, inc. produces three products from a common input. the joint costs for a typical quarter follow: direct materials $45,000 direct labor 55,000 overhead 60,000 the revenues from each product are as follows: product a $75,000 product b 80,000 product c 30,000 management is considering processing product a beyond the split-off point, which would increase the sales value of product a to $116,000. however, to process product a further means that the company must rent some special equipment costing $17,500 per quarter. additional materials and labor also needed would cost $12,650 per quarter. a. what is the gross profit currently being earned by the three products for one quarter? $answer b. what is the effect on quarterly profits if the company decides to process product a further? $answer