Fiscal policy is concerned with:
a. encouraging businesses to invest.
b. regulation of net exports.
c. changes in government spending and/or tax revenues.
d. expanding and contracting the money supply.
c
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In the aggregate expenditure model, which of the following variables is assumed to be independent of real GDP?
A. consumption B. saving C. investment D. profit
List and explain factors that determine the size of the expenditure multiplier in the expenditure model when prices are constant
What will be an ideal response?
Refer to Figure 11-2. Based on the per-worker production function above, if the economy raises capital per hour worked from $35,000 to $40,000, by how much will real GDP per hour worked increase?
A) $150 B) $1,850 C) $2,000 D) $5,000
Explain the endowment effect
What will be an ideal response?