If autonomous spending decreases, then
A) the expenditure multiplier means that equilibrium expenditure increases by a larger amount.
B) the expenditure multiplier means that equilibrium expenditure increases by a smaller amount.
C) equilibrium expenditure does not change.
D) the expenditure multiplier means that equilibrium expenditure decreases by a larger amount.
E) equilibrium expenditure decreases by the same amount.
D
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A constant-elasticity demand function can be obtained by:
A) taking the logarithm of the dependent variable only. B) taking the logarithm of the independent variable(s) only. C) taking the logarithm of the dependent and independent variable(s). D) taking the reciprocal of the dependent variable(s).
The rising phase of a business cycle measured by an increase in real GDP is called:
A) trough. B) expansion. C) recession. D) contraction.
In the IS-LM model, the two variables that are affected by the interest rate are
a. money supply and money demand. b. money supply and investment spending. c. money demand and consumption. d. money demand and investment spending. e. none of the above.
The balance sheet of a bank shows its
A. profits and losses. B. assets and liabilities. C. revenues and costs. D. earnings and expenses.