In Econland autonomous consumption equals 700, the marginal propensity to consume equals 0.80, net taxes are fixed at 50, planned investment is fixed at 100, government purchases are fixed at 100, and net exports are fixed at 40. The vertical intercept of the expenditure line is:
A. 990.
B. 890.
C. 900.
D. 940.
Answer: C
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In the generalized dividend model, the current stock price is the sum of
A) the actual value of the future dividend stream. B) the present value of the future dividend stream. C) the present value of the future dividend stream plus the actual future sales price. D) the present value of the future sales price.
If the supply of oceanfront lots is fixed and perfectly inelastic,
a. the demand for the resource determines its price and the level of economic rent b. the supply of the resource determines its price and the level of economic rent c. the supply of the resource determines its price and the demand for the resource determines the level of economic rent d. the demand for the resource determines its price and the supply of the resource determines the level of economic rent e. the supply curve is horizontal
Central banks can use _______________________ to reduce the quantity of money and loans in an economy.
a. closed market operations b. public market operations c. open market operations d. private market operations
A temporary decrease in the price of oil would be considered a:
A. long-run supply shock. B. demand shock. C. short-run supply shock. D. The changing price of oil would not affect any of these.