Use the following graph to answer the next question.
Which of the following factors does NOT explain a movement along the AD curve?
A. The real-balances effect
B. The foreign purchases effect
C. The expenditure multiplier effect
D. The interest-rate effect
Answer: C
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Refer to Table 11.1. If the marginal propensity to consume decreases to 0.05 (MPC = 0.05), what is the new equilibrium level of output?
A) 2,366.67 B) 3,166.67 C) 3,550.00 D) 4,750.00
Grocery shoppers who willingly pay high prices at one supermarket to avoid long lines at the check-out counter of another supermarket with lower prices demonstrate, through their actions,
A) they are not rational shoppers. B) they don't care about money. C) they would pay any amount of money to save a little time. D) all of the above. E) none of the above.
The expected yield on an asset with two possible outcomes is equal to the
A) difference between the two outcomes. B) sum of the possible outcomes multiplied by their respective probabilities. C) standard deviation of the two outcomes. D) product of the two outcomes.
What is the difference between comparative advantage and absolute advantage?
What will be an ideal response?