If a $200 billion increase in investment spending creates $200 billion of new income in the first round of the multiplier process and $160 billion in the second round, the multiplier in the economy is:
A. 4.
B. 5.
C. 3.33.
D. 2.5.
B. 5.
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When a tariff is imposed on a good, the ________ increases
A) domestic quantity purchased B) domestic quantity produced C) quantity imported D) quantity exported E) world price
A wealthy Japanese executive decides to buy a large amount of U.S. assets. This would contribute to
a. a deficit in the U.S. current account b. a deficit in the U.S. capital account c. a surplus in the U.S. current account d. a surplus in the U.S. capital account e. a deficit in the total balance of payments
What do we call financial institutions through which savers can indirectly provide funds to borrowers?
a. stock markets b. financial institutions c. financial markets d. financial intermediaries
A monopoly is best defined as a firm that
A) produces a good or service for which no close substitute exists and which is protected by a barrier that prevents other firms from selling that good or service. B) purchases its resources from only one supplier because of a barrier preventing it from buying from other suppliers. C) produces a good or service for which no close substitute exists and that sells all its output to one buyer because there is barrier preventing other buyers from purchasing the good or service. D) cannot control the price it sets for its good or service because there is barrier that prevents the firm from changing the price.