If the MPC = .75, the spending multiplier is:
a. 4.
b. 5.
c. 1.33.
d. 1.20.
e. .25.
a
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According to your text, competition generally requires
A) fixed costs. B) fixed prices. C) fixed profits. D) detailed government regulation. E) none of the above.
Other things equal, the level of real GDP will tend to increase in the short run:
a. if reserve requirements are decreased b. if the Fed decreases the interest rate it pays on bank reserves c. if there is an open market purchase by the Fed. d. all of the above
Taxes add to and transfers subtract from the flow of income and spending
a. True b. False Indicate whether the statement is true or false
Suppose that foreign citizens decide to purchase more U.S. pharmaceuticals and U.S. citizens decide to buy more stock in foreign corporations. Other things the same, these actions
a. raise both U.S. net exports and U.S. net capital outflows. b. raise U.S. net exports and lower U.S. net capital outflows. c. lower both U.S. net exports and U.S. net capital outflows. d. lower U.S. net exports and raise U.S. net capital outflows.