The change in import spending due to a change in domestic real income is called:
A) marginal propensity to save.
B) marginal propensity to consume.
C) marginal propensity to import.
D) none of the above.
C
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If real GDP in year 1 is $72 million and real GDP in year 2 is $87 million, then the growth rate of real GDP is
A) 15 percent. B) $15 million. C) 20.8 percent. D) 17 percent. E) 83 percent.
Refer to Scenario 5.4. What is the variance of the investment?
A) -75 B) 275 C) 3,150 D) 4,637.50 E) 8,125
Velocity is commonly calculated by which of the following formulas?
A. (Value of money stock) / (Value of nominal GDP) B. (Value of transactions) / (Money stock) C. (Value of financial transactions) / (GDP) D. (Value of output) / (Value of input)
The open-economy IS curve slopes down because any change in the foreign or home interest rate will inversely affect demand, along with a secondary effect from a change in:
A) the rate of depreciation of assets. B) the exchange rate and the trade balance. C) the real interest rate. D) the growth rate of money.