An increase in spending in an economy will cause a multiplied increase in gross domestic product because
A) government spending is greater than zero
B) investment is greater than zero
C) investment increases as income decreases
D) consumption increases as income increases
E) taxes increase as income increases
Ans: D) consumption increases as income increases
You might also like to view...
The diagram used to show one player's strategies across the top and the other player's strategies along the left, with the corresponding outcomes in the appropriate boxes is a
a. game matrix. b. flow chart. c. mixed strategy. d. an oligopoly problem.
The real rate of interest is 4% and the anticipated rate of inflation is 1%. What is the nominal rate of interest?
A) 1% B) 3% C) 4% D) 5%
Market Supply and Demand
What will be an ideal response?
Governments tend to set price ceilings:
A. to prevent consumers from choosing the wrong goods. B. to ensure producers make enough for everyone. C. to ensure producers make enough profit to stay in the industry. D. to ensure everyone can afford certain goods.