The marginal propensity to save is 0.2. Equilibrium real GDP will decrease by $50 billion if aggregate expenditures schedule decrease by
A. $15 billion.
B. $10 billion.
C. $16 billion.
D. $40 billion.
Answer: B
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The Federal Reserve buying government bonds is considered:
a) easy money. b) tight money. c) expansionary monetary policy. d) contractionary monetary policy.
Which of the following antebellum transportation innovations was financed primarily by government funds?
a. the Erie Canal b. the New Orleans steamboat c. the Lancaster Turnpike d. the Ann McKim clipper ship
In monopolistically competitive markets, economic profits ____, and ____ shifts the demand curve of the remaining firms to the ____
a. signal some remaining firms to exit; exit; right b. signal some remaining firms to exit; exit; left c. signal new firms to enter; entry; left d. signal new firms to enter; entry; right
Refer to Figure 2-12. What is the opportunity cost of producing one gallon of milk in Bora Bora?
A) 1.5 gallons of honey B) 0.8 gallons of honey C) 1.125 gallons of honey D) 2/3 of a gallon of honey