Exam 8: Basic Macroeconomic Relationships

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

As disposable income goes up the:

-Refer to the above diagram. At income level F the volume of saving is:

Suppose the consumption schedule is: C = 20 + .9Y, where C is consumption and Y is disposable income. -Refer to the above data. At an $800 level of disposable income, the level of saving is:

Assume the consumption schedule for a private closed economy is C = 40 + 0.75Y, where C is consumption and Y is gross domestic product. The multiplier for this economy:

As aggregate income increases, the APC:

-Refer to the above diagram. At disposable income level D, consumption:

The multiplier effect indicates that:

The equation for the above saving schedule is:

The multiplier is useful in determining the:

The following table illustrates the multiplier process in a private closed economy: -Refer to the above table. The change in income in round two will be:

Following is consumption schedules for three private closed economies. DI signifies disposable income and C represents consumption expenditures. All figures are in billions of dollars. -Refer to the above data. Suppose that consumption increased by $2 billion at each level of DI in each of the three countries. We can conclude that the:

The simple multiplier applies:

The consumption schedule in the diagram below indicates that:

The saving schedule is drawn on the assumption that as income increases:

-Refer to the above diagram. The MPC is constant as income rises for:

Which of the following relations is not correct?

Suppose the government finds it can increase equilibrium real GDP by $45 billion by increasing government purchases by $18 billion. On the basis of this information we can say that the:

Refer to the data below. The MPS is:

The numerical value of the multiplier will be smaller the: