Exhibit 9-3 Keynesian aggregate expenditures model
?
As shown in Exhibit 9-3, if GDP is $6 trillion, the economy experiences unplanned inventory:
A. depletion of $2 trillion.
B. depletion of $6 trillion.
C. accumulation of $2 trillion.
D. accumulation of $6 trillion.
Answer: A
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Doubling the circumference of an oil pipeline more than doubles the volume of oil that can be pumped through. This is an example of
a. production inefficiency b. diminishing marginal returns c. diseconomies of scale d. constant returns to scale e. economies of scale
When the tax structure of a nation is progressive, as incomes increase, the tax rate:
a. declines. b. remains the same. c. increases. d. is proportional.
Which of the following should be held constant when calculating an income elasticity of demand?
a. the quantity of the good demanded b. the price of the good c. income d. All of the above should be held constant.
Assume the marginal propensity to consume (MPC) is 0.80 and the government increases taxes by $100 billion. The aggregate demand curve will shift to the:
A. left by $80 billion. B. right by $200 billion. C. right by $400 billion. D. left by $400 billion.