If intended investment increases by $50, and the MPC remains unchanged at 0.75, then
a. the economy is in equilibrium at both levels of intended investment because MPC remains unchanged
b. national income remains unchanged regardless of the change in intended investment
c. MPS must increase from 0.25 to 0.75
d. national income increases by $200
e. we know this couldn't happen because the MPC cannot remain unchanged when intended investment changes
D
You might also like to view...
The fraction of additional income spent on imports is called the
A) marginal propensity to export. B) import function. C) marginal propensity to import. D) trade balance.
Consider a nation that has a comparative advantage in the production of goods using unskilled labor. What types of workers will benefit from increased trade, and what type will lose?
What will be an ideal response?
When producers are hard to monitor and marginal costs differ across producers, ________ are an effective method to achieve efficient use of a ________
A) individual transferable quotas; public good B) marginal private benefits; public good C) individual transferable quotas; common resource D) individual transferable quotas; excludable good
Sandee Hollub, an elementary school teacher, believed that she was being treated unfairly by her principal, so she stormed off the job and two days later found another teaching job in another school. For two days, Sandee experienced
a. cyclical unemployment b. structural unemployment c. involuntary unemployment d. frictional unemployment e. being out of the labor force