In the Keynesian model, the larger the marginal propensity to consume, the:
A. larger the multiplier.
B. larger the marginal propensity to save.
C. higher the income level of the economy.
D. smaller the change in income derived from a given change in government spending.
Answer: A
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Since the 1970s, the United States has had higher unemployment rates than most European countries.
Answer the following statement true (T) or false (F)
A rise in the price level produces ________ the potential GDP line
A) a movement downward along B) a leftward shift of C) a rightward shift of D) a movement upward along E) neither a shift of the potential GDP line nor a movement along
Which of the following is not a determinant of a good's price elasticity of demand?
A) the slope of the demand curve B) whether the good is a luxury or a necessity C) the share of the good in the consumer's total budget D) the passage of time
The institutions that bring together savers, borrowers, investors, and insurers in a set of interconnected markets where people trade financial products is called the:
A. financial system. B. money system. C. market for interest rates. D. market for loanable funds.