Multiple Choice
Assume that the MPC is 0.75. Full employment is considered to be at a GDP level of $500 billion. The GDP is $600 billion. What should the government do to achieve full employment?
A) increase spending by $25 billion
B) increase spending by $10 billion
C) reduce spending by $25 billion
D) reduce spending by $100 billion
Correct Answer:
Verified
Correct Answer:
Verified
Q14: Which group of economists believed that economic
Q32: Keynes's insight during the Great Depression was
Q153: _ is the change in saving associated
Q154: Expectations of large increases in income lead
Q158: If aggregate expenditures equals $6,200 and aggregate
Q159: If the marginal propensity to consume is
Q160: Which country has the lowest national savings
Q185: When the consumption schedule lies above the
Q233: The inflationary gap is the amount of
Q238: If the amount of spending in an