In preparing their estimates of the stimulus package's effect on GDP, Obama administration economists estimated a government purchases multiplier of 1.57. This indicates that a $1 billion increase in government purchases would increase equilibrium real
GDP by
A) $1 billion.
B) $1.57 billion.
C) $15.7 billion.
D) $157 billion.
Answer: B
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The _____ measures the degree of association between two independent variables in an a distribution
a. expectation b. standard deviation c. correlation coefficient d. variance
In high-inflation countries, workers prefer to spend their income faster compared to low-inflation countries
a. True b. False Indicate whether the statement is true or false
The tendency for nominal interest rates to be high when inflation is high and low when inflation is low is known as:
A. deflating. B. shoe leather costs. C. the Fisher effect. D. the consumer price index.
Which of the following statements concerning saving is true?
A. A country's saving rate is unrelated to its growth rate. B. A country's growth rate is unrelated to its national income. C. An increase in the rate of saving will lead to a reduction in consumption in the short run and in the long run. D. An increase in the rate of saving decreases gross domestic income by reducing current consumption but increases current and future gross domestic income through investment in capital goods.