Solved

Suppose Full Employment Real GDP Is $12 Trillion, Current Real

Question 233

Multiple Choice

Suppose full employment real GDP is $12 trillion, current real GDP is $11 trillion, and the marginal propensity to consume is 0.8. The recessionary gap is:


A) $1 trillion.
B) $0.8 trillion.
C) $0.2 trillion.
D) $0.5 trillion.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Q19: The slope of the consumption function is

Q46: If the interest rate increases, investment will<br>A)

Q181: The average propensity to consume is<br>A) always

Q191: What occurs when spending is above the

Q229: Which is true about differences in savings

Q231: (Table) The table shows data on

Q234: If you believe that your income will

Q235: If income increases from $3,000 per month

Q236: In the Keynesian framework, increments of spending,

Q237: Decreases in government spending _ equilibrium income,