When the equilibrium price level adjusts to an increase in autonomous investment spending, the impact of the multiplier effect resulting from that spending increase
A) will increase nominal GDP by an amount smaller than the multiplier effect would indicate.
B) is only felt when there are changes in consumption.
C) will increase real GDP by an amount smaller than the multiplier effect would indicate.
D) will have no impact on the real GDP.
C
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Which statement is consistent with what Keynes believed about consumption and disposable income?
A) Consumption depends upon disposable income and falls as disposable income rises. B) Consumption rises by the same amount as disposable income rises. C) Consumption rises by less than disposable income rises. D) Disposable income depends upon consumption.
Answer the following statement(s) true (T) or false (F)
1. Economists mostly observe and study what people think, not what they do. 2. Our charitable actions for others are influenced by our assessment of our own benefits and costs. 3. Rational self-interest means that individuals try to weigh the expected marginal benefits and marginal costs of their decisions. 4. Theories and models are more complex versions of the real world used to explain and predict behavior.
Which of the following is NOT necessary for price discrimination to occur?
A) The firm must be able to separate the market into identifiable groups. B) The firm must be selling a durable good. C) The firm must have a downward sloping demand curve. D) The firm has to be able to prevent resale of the product or service.
The law of increasing opportunity cost implies that
A. producing additional units of one good results in proportionately smaller reductions in output of the other good. B. the production possibilities curve will be a straight line. C. the society will be producing on its production possibilities curve. D. producing additional units of one good results in increasing amounts of lost output of the other good.