The tendency for ________ to decrease when ________ decreases is the result of the accelerator effect.
A. aggregate output; saving
B. consumption; investment
C. saving; consumption
D. investment; aggregate output
Answer: D
You might also like to view...
The cyclically adjusted budget is calculated at potential GDP
Indicate whether the statement is true or false
Suppose there is a water shortage, and the governor proposes that the government distribute equal quantities of water to each person at no cost to the consumers
If consumers were forbidden to trade water, would such a distribution be Pareto optimal? A) Yes, because each person has the same amount of water as everyone else. B) Yes, because everyone would be receive their water for free. C) Not necessarily, as people may differ in their marginal rates of substitution between water and other goods. D) It is impossible to determine without knowing the price of water. E) none of the above
In the aggregate demand and supply model, the:
a. vertical axis measures the average price level. b. horizontal axis measures real GDP. c. aggregate supply curve is vertical at full-employment real GDP. d. All of these.
Which of the following factors affect a country's net foreign investment?
a. real interest rates paid on foreign assets b. real interest rates paid on domestic assets c. government policies that affect foreign ownership of domestic assets d. all of the above e. none of the above