Multiple Choice
An economy has full-employment output of 5000. Government purchases are 1000. Desired consumption and desired investment are given by Cd = 3000 - 2000r + .10Y
Id = 1000 - 4000r
Where Y is output and r is the real interest rate. The real interest rate that clears the good market is equal to
A) 1.25%.
B) 2.50%.
C) 8.33%.
D) 25.00%.
Correct Answer:
Verified
Correct Answer:
Verified
Q11: Three factors that cause interest rates among
Q11: An invention that raises the future marginal
Q19: An increase in expected real interest rates
Q33: Suppose your company is in equilibrium,with its
Q44: All else equal,a decrease in the expected
Q45: You have just purchased a new VCR
Q52: A temporary increase in government purchases would
Q53: The nominal interest rate on taxable bonds
Q67: Perpetual plastic plant makers cost $200
Q71: A temporary increase in government purchases,given the