Solved

If Government Expenditure Rises by $40 Billion and the Multiplier

Question 90

Multiple Choice

If government expenditure rises by $40 billion and the multiplier in the economy is 2.5, then real GDP_____, and the IS curve shifts to the_____.

A) rises by $40 billion; right
B) falls by $40 billion; left
C) rises by $100 billion; right
D) rises by $16 billion; right

Related Questions

Q85: Which of the following shows the correct

Q86: If potential GDP is $26.5 trillion and

Q87: For each of the following cases, draw

Q88: If the U.S. government lowers personal income

Q89: Explain how each of the following changes

Q91: Refer to the table shown here.

Q92: Suppose that with a real interest rate

Q93: The Ugandan shilling depreciates. How does this

Q94: Which of the following changes could create

Q95: Lower interest rates cause the U.S. dollar