During recessions declines in investment account for about
a. 1/6 of the decline in real GDP.
b. 1/7 of the decline in real GDP.
c. 1/3 of the decline in real GDP.
d. 2/3 of the decline in real GDP.
d
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Why does the production possibilities frontier have a bowed out shape rather than being a straight line?
What will be an ideal response?
The aggregate demand curve has an upward slope due to the positive relationship between the price level and aggregate quantity demanded
a. True b. False Indicate whether the statement is true or false
If the cost of producing automobiles increases, the price, equilibrium quantity and consumer surplus will most likely change in which of the following ways? Price Quantity Consumer Surplus
A. Increase Increase Increase B. Increase Increase Decrease C. Increase Decrease Decrease D. Decrease Increase Decrease E. Decrease Decrease Decrease
If the MPC is 0.8, and the government spends an additional $100b, the overall effect on GDP will be:
A. $400b. B. $180b. C. $500b. D. $120b.