Exam 10: Basic Macroeconomic Relationships

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  -Refer to the above data.The marginal propensity to consume is: -Refer to the above data.The marginal propensity to consume is:

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The investment-demand curve will shift to the right as a result of:

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The APC can be defined as the fraction of a:

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Assume that for the entire business sector of a private closed economy there is $0 worth of investment projects which will yield an expected rate of return of 25 percent or more.But there are $15 worth of investments which will yield an expected rate of return of 20-25 percent;another $15 with an expected rate of return of 15-20 percent;and similarly an additional $15 of investment projects in each successive rate of return range down to and including the 0-5 percent range. Assume that for the entire business sector of a private closed economy there is $0 worth of investment projects which will yield an expected rate of return of 25 percent or more.But there are $15 worth of investments which will yield an expected rate of return of 20-25 percent;another $15 with an expected rate of return of 15-20 percent;and similarly an additional $15 of investment projects in each successive rate of return range down to and including the 0-5 percent range.   Which of the lines on the above diagram represents these data? Which of the lines on the above diagram represents these data?

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The saving schedule shown in the diagram below would shift downward if,all else equal: The saving schedule shown in the diagram below would shift downward if,all else equal:

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The investment-demand curve suggests:

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The multiplier effect:

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  -The above schedule indicates that if the real interest rate is 8 percent,then: -The above schedule indicates that if the real interest rate is 8 percent,then:

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If the marginal propensity to consume is .9,then the marginal propensity to save must be:

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The relationship between consumption and disposable income is such that:

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Which of the following equations correctly represents the data below? Which of the following equations correctly represents the data below?

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  -Refer to the above data.At the $100 level of income,the average propensity to save is: -Refer to the above data.At the $100 level of income,the average propensity to save is:

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One can determine the amount of consumption at any level of total income by:

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The numerical value of the multiplier will be smaller the:

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The simple multiplier applies:

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Which of the following is correct?

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Assume a machine which has a useful life of only one year costs $2,000.Assume,also,that net of such operating costs as power,taxes,and so forth,the additional revenue from the output of this machine is expected to be $2,300.The expected rate of return on this machine is:

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A specific investment will be undertaken if the expected rate of returns,r,exceeds the interest rate,i.

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The immediate determinants of investment spending are the:

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The following table illustrates the multiplier process in a private closed economy: The following table illustrates the multiplier process in a private closed economy:    -Refer to the above table.The total change in consumption resulting from the initial change in investment will be: -Refer to the above table.The total change in consumption resulting from the initial change in investment will be:

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