Problem
Bayou Sans Espoir, LA, has been experiencing a mini-recession because of the significant decline in crude oil prices and cuts in state subsidies to its crawfish packing plant. As a result of falling oil prices, the oil companies operating in Bayou Sans Espoir have reduced investment spending in the area by $8 mil; Cajun Crawfish, the largest crawfish packing operation, has reduced local investment by $500,000. a.)a. If the local marginal propensity to consume is 0.75, by how much has decreased investment spending reduced local gross domestic product and income?
The question: The Chinese have discovered crawfish (miniature lobster on menus in China) and have placed new orders with Cajun Crawfish amounting to $6 mil annually. By how much will local GDP increase as a result of the increase in crawfish sales?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.