Re: DSE 2010 - macroeconomics

Posted by Amit Goyal on
URL: http://discussion-forum.276.s1.nabble.com/DSE-2010-macroeconomics-tp6473351p6474505.html

Since workers have a higher MPC, lump-sum income transfer from capitalist to the workers will raise the overall consumption levels and hence the income level of the economy. Tax revenue will thus go up and since govt. expenditure is unchanged budget will go in surplus.