In Econland autonomous consumption equals 700, the marginal propensity to consume equals 0.80, net taxes are fixed at 50, planned investment is fixed at 100, government purchases are fixed at 100, and net exports are fixed at 40. Induced expenditure equals:
A. 0.20Y.
B. 990 + 0.20Y.
C. 900 + 0.80Y.
D. 0.80Y.
Answer: D
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A) as much as 20 percent below the levels in the 1990s. B) as much as 5 percent below the levels in the 1990s. C) as much as 50 percent below the levels in the 1990s. D) as much as 50 percent below the levels in the 1960s.
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Which of the following is likely to cause a decrease in labor productivity?
a. An increase in student achievement scores b. A service sector that is growing slower than the growth rate of GDP c. An increased spending on research and development d. A decrease in capital formation e. A low federal budget deficit
The income of managers is often ____ diversified compared to the income of stockholders
A) more easily B) equally easily C) less easily D) smaller