If government spending is increased by $300, taxes are reduced by $300, and the MPS is 0.5, equilibrium output will change by
A. $0.
B. $300.
C. $900.
D. an amount that cannot be determined from this information.
Answer: C
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Refer to the scenario above. If Alice values fairness, ________
A) she will not accept any offer made by Robert B) Robert should make the lowest possible offer to Alice C) she will accept the offer when Robert offers $250 D) Robert should not play the game
When two people agree to a price in a negotiation, we can assume that:
A. each one will receive equal benefits from the transaction. B. only one of the parties will benefit, but there is not enough information to determine which one it will be. C. the seller will receive more benefit from the transaction than the buyer. D. both parties will benefit.
Refer to the above table. Suppose one country has a per capita real GDP of $1000 and another has a per capita real GDP of $10,000, or ten times larger. If both countries have a growth rate of 5 percent, how much larger will per capita real GDP be in the second country be than the first after 50 years?
A) 8 times larger B) 5 times larger C) 10 times larger D) 4 times larger
When households increase their personal savings ________
A) investment decreases B) they are better able to cope with severe economic downturns C) interest rates are likely to rise, as well D) all of the above E) none of the above