How does adding in investment, government spending, and net exports affect the slope of the consumption function?
a. It makes the slope steeper.
b. It makes the slope less steep.
c. It does not change the slope.
d. It makes the slope vertical.
c. It does not change the slope.
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A bank's required reserves are calculated by multiplying ________
A) its deposits by the required reserve ratio B) the sum of its deposits and cash in its vault by the required reserve ratio C) cash in its vault by the required reserve ratio D) the gold in its vault by the required reserve ratio
Which diagram below illustrates the effect on the natural-gas market, with the widespread use of "fracking" or hydraulic fracturing by gas-drilling companies?
In the diagrams below, the subscript "1" refers to the initial position of the curve, while the subscript "2" refers to the final position after the curve shifts.
A. A
B. B
C. C
D. D
The traditional Keynesian approach concludes that an increase in government spending
A) generates a greater increase in investment spending. B) generates a greater increase in total spending because consumption spending increases as incomes increase. C) has no effect on total spending because consumers increase saving by an equal amount. D) generates an equal increase in total spending because government spending makes up part of total spending.
The after-tax income received by the household sector is known as ________
A) disposable income B) retained earnings C) net national product per capita D) Gross Domestic Product