Exhibit 9-6 Keynesian aggregate expenditure model when the MPC is 2/3
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The economy shown in Exhibit 9-6 has a recessionary gap of:
A. $1 trillion.
B. $2 trillion.
C. $3 trillion.
D. $5 trillion.
Answer: A
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Suppose the government's budget deficit increases by $500 billion. If there is no Ricardo-Barro effect, what occurs?
A) The supply of loanable funds curve shifts leftward, the real interest rate rises, and the quantity of loanable funds decreases. B) The supply of loanable funds curve shifts rightward, the real interest rate falls, and the quantity of loanable funds increases. C) The demand for loanable funds curve shifts rightward, the real interest rate rises, and the quantity of loanable funds increases. D) The demand for loanable funds curve shifts leftward, the real interest rate falls, and the quantity of loanable funds decreases. E) The supply of loanable funds curve shifts leftward, the real interest rate rises, and the quantity of loanable funds increases.
If the total cost of producing one unit of the output is $100 and the marginal cost of that unit is $20, the average fixed cost of producing two units of output is ________
Fill in the blank(s) with correct word
The theory of consumer behavior is based on certain assumptions. The set of four basic assumptions includes:
A) completeness. B) transitivity. C) intransitivity. D) Both A and B are correct. E) Both A and C are correct.
Big Mowers is a firm selling large farm equipment. To attract new customers they are running a promotion in which customers are asked to guess the number of raw corn kernels in a gallon bucket. It is free for a customer to guess and if they get the exact number of kernels correct, they win a $200,000 lawn tractor. Big Mowers is running the promotion for a week and the probability a customer gets
the exact number of kernels correct during that one week is 0.001. What is the expected cost of the promotion? A) $200 B) $2 C) $20 D) $2,000