Government spending increases by $80 billion and the equilibrium level of output increases by $320 billion. The government spending multiplier
A. is 4.
B. is 5.
C. is 6.
D. cannot be determined from this information, because the MPC is not given.
Answer: A
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Gross national product is defined as
A) the value of final goods and services produced by residents of the United States even if the production takes place outside of the United States. B) the value of final goods and services produced within the United States, by United States residents. C) the value of final goods and services produced outside of the United States. D) the value of final goods and services produced within the United States.
An unexpected rise in GDP growth should send bond prices __________ and stock prices __________
A) up; up B) up; down C) down; up D) down; down
Which of the following best describes the way resources are allocated in the U.S. economy?
a) By government. b) By markets. c) By rules. d) By regulations.
Objects that have value because the holder can exchange them for something else of value:
a. fiat money b. commodity money c. currency d. representative money