The multiplier effect refers to the series of
A) autonomous increases in consumption spending that result from an initial increase in induced expenditures.
B) induced increases in consumption spending that result from an initial increase in autonomous expenditures.
C) autonomous increases in investment spending that result from an initial increase in induced expenditures.
D) induced increases in investment spending that result from an initial increase in autonomous expenditures.
Answer: B
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What is the discounted value of $60,000 to be received after six years, if the ongoing rate of interest is 6% per annum?
A) $41,212.84 B) $42,297.63 C) $44,666.95 D) $51,220.64
A decrease in consumer confidence will cause a:
A. movement downward along the aggregate demand curve. B. shift in aggregate demand to the right. C. shift in aggregate demand to the left. D. movement upward along the aggregate demand curve.
The price of imported oil rises. If the government wanted to stabilize output, which of the following could it do?
a. increase government expenditures or increase the money supply b. increase government expenditures or decrease the money supply c. decrease government expenditures or increase the money supply d. decrease government expenditures or decrease the money supply
If firms in a competitive market have different cost functions, then
A) there is no short run market supply curve. B) the market supply curve reflects those firms' operating envelopes, even in the short run. C) some of the firms will shut down because their costs are too high to compete. D) the firms' marginal costs will be different at the market price.