If the marginal propensity to consume is 0.8, and aggregate expenditure initially increases by $100 million, then the aggregate demand curve will shift outwards by $500 million, holding the price level constant
Indicate whether the statement is true or false
true
You might also like to view...
If the growth rate for GDP was 5 percent and GDP in year 1 was 140, then GDP in year 2 would be
A) 133.3. B) 135. C) 145. D) 147.
Government mandated safety standard within firms
A) will always decrease efficiency. B) can increase efficiency by avoiding a prisoner's dilemma outcome. C) are unnecessary because of asymmetric information. D) will create unfair competition among firms.
Time series variables fail to be stationary when
A) the economy experiences severe fluctuations. B) the population regression has breaks. C) there is strong seasonal variation in the data. D) there are no trends.
We calculate many different kinds of price indexes:
A. in order to capture a complete picture of how price changes are affecting the economy. B. to see how the prices of different groups of goods are changing. C. to measure how different groups of people in the economy are being affected by changing prices. D. All of these statements are true.