If government purchases increase by $100 billion and lead to an ultimate increase in aggregate demand as shown in the graph to the right, the difference in real GDP between point A and point B will be
A. less than? $100 billion.
B. more than? $100 billion.
C. ?$100 billion.
D. There is insufficient information given here to draw a conclusion.
Answer: B. more than? $100 billion.
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An index based on a mail survey of 5,000 households by the Conference Board that measures households' perceptions of general business conditions, available jobs in the households' local area, and expected personal family income in the coming six
months is called the: A) Consumer Sentiment Index. B) Consumer Confidence Index. C) Consumer Satisfaction Index. D) Consumer Consumption Index.
The IS curve depicts the relationship between
A) aggregate output and the real interest rate. B) investment demand and the real interest rate. C) investment demand and the level of current output. D) national saving and the level of current output.
If marginal revenue is less than marginal costs
A) production should be decreased. B) production should be decreased and profits will grow. C) production should be decreased and losses will decrease. D) all of these choices are possible.
The cable and subscription TV business is plagued with the problem of "signal theft." People use illegal receivers to capture the company's signal without paying. Enforcement of the company's property right is very expensive. This problem emerges because TV signals are basically
a. economic goods. b. invisible goods. c. depletable goods. d. public goods.