In the third quarter of 2008, investment in the US totaled $1.4 trillion and in 2007, investment was $1.3 trillion. The change in investment:
a) is a change in autonomous expenditure
b) is a change in equilibrium expenditure
c) is a change in induced expenditure
d) will increase the multiplier
a) is a change in autonomous expenditure
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The reserve ratio is 10% and a bank has $600,000 in transaction deposits. The amount of reserves equals
A) $6,000. B) $60,000. C) $600,000. D) undeterminable without information on cash reserves.
Comment on the following statement: "A firm with market power is able to charge any price it likes."
What will be an ideal response?
If a firm charges different consumers different prices for the same product and the difference cannot be attributed to cost variations, then it is engaging in
A) markup pricing. B) cost-plus pricing. C) odd pricing. D) price discrimination.
Which of the following is a factor that is relevant to country risk analysis?
A) political uncertainty B) external debt C) economic growth D) all of the above.