Multiple Choice
Which of the following is an important assumption in the short-run macro model?
A) Government spending depends on income.
B) Output does not change.
C) Firms do not maintain inventories.
D) Investment depends on income.
E) Prices do not change.
Correct Answer:
Verified
Correct Answer:
Verified
Q87: Transfer payments<br>A) shape the structural deficit<br>B) tend
Q88: If the expenditure multiplier is 3.5 and
Q89: Net exports<br>A) are the second largest component
Q90: The marginal propensity to consume (MPC)is typically<br>A)
Q91: The marginal propensity to consume tells us
Q93: A recession occurs only if there are
Q94: Net exports<br>A) are equal to total exports
Q95: If aggregate expenditure was less than GDP,which
Q96: If aggregate expenditure exceeds GDP,we expect inventories
Q97: If investment spending decreases by $500 billion