In Corinthia, the marginal propensity to consume is 0.7, base consumption is $500, the tax rate is 20 percent of income, national income is $3,000 . investment spending is $1,000 . government spending is $1,000 . export earning is $2,000 . and import spending is $500 . When the real GDP of Corinthia is zero, its aggregate expenditure equals _____
a. $4,000
b. $7,500
c. $8,900
d. $10,000
a
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The government may enact contractionary fiscal policy if there are concerns about
A. excessive inflation. B. declining output. C. high unemployment. D. high tax rates.
Refer to the above figure. Suppose point A is the original equilibrium. If there is an increase in the money supply, the new long-run equilibrium is given by point
A) A. B) B. C) C. D) D.
Mandated on-the-job training is seen in the United States mainly as a(n)
a. useful spur to economic growth. b. proper use of legislative power. c. unwarranted governmental interference. d. necessary requirement for increased productivity.
The Board of Governors of the Federal Reserve serves on a larger policy-making group called the House Banking Committee
Indicate whether the statement is true or false