With normally-sloped IS and LM curves, an increase in government expenditure ________ consumption expenditure since autonomous consumption ________ while induced consumption ________
A) can raise or lower, falls, rises
B) can raise or lower, rises, falls
C) must decrease, falls, also falls
D) must decrease, rises, falls
E) must increase, rises, also rises
A
You might also like to view...
In South Asia and Sub-Saharan Africa, about what share of output is contributed by agriculture?
(a) One tenth. (b) One fifth. (c) Two fifths. (d) One half.
If MR > MC, a profit-maximizing firm should increase output
Indicate whether the statement is true or false
If the economy was producing at point X and moved to point Y,
A. it would have moved from where the economy operates most of the time to a severe recession.
B. it would have moved from where the economy operates most of the time to a depression.
C. the unemployment rate would increase.
D. it would have moved from where the economy operates most of the time to a severe recession AND the unemployment rate would increase.
If the price of train rides is 1 and the price of food is 10, and the MRS of food for train rides expressed by Karl is 5, is Karl a utility maximizer? How do you know? If Karl is not maximizing, what should he do to improve his situation?
What will be an ideal response?