Investment spending includes spending on:
A. capital goods, residential housing, and changes in inventories.
B. goods and services by federal, state, and local governments.
C. durables, nondurables, and services.
D. stocks, bonds, and other financial instruments.
Answer: A
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You have just noticed that the dollar appreciated and you suspect that U.S. policymakers were behind this change. Which would you choose as the most likely cause of this appreciation in the real exchange rate?
A) An increase in the money supply B) A decrease in the money supply C) A temporary increase in government purchases D) A temporary decrease in taxes
The sum of consumption and investment is: a. total production. b. aggregate supply
c. aggregate disposable demand. d. aggregate expenditures.
Assume that consumption in the United States is $9,000 billion in 2009 . If the MPC is 0.8 and disposable income increases by $1,000 billion in 2010, then the level of consumption in 2010 will be
a. $10,000 billion. b. $9,800 billion. c. $9,000 billion. d. $7,200 billion.
This profit-maximizing (loss-minimizing) firm produces a quantity of about _______ units.
A. 100
B. 80
C. 50
D. 30