In the income-expenditure model, if autonomous investment decreases by $10 billion, a. planned saving increases by $10 billion b. the aggregate expenditure line shifts downward by $10 billion c. planned saving decreases by $10 billion d. the aggregate expenditure line shifts upward by $10 billion e. the equilibrium level of real GDP demanded increases by $10 billion

In the income-expenditure model, if autonomous investment decreases by $10 billion, a. planned saving increases by $10 billion b. the aggregate expenditure line shifts downward by $10 billion c. planned saving decreases by $10 billion d. the aggregate expenditure line shifts upward by $10 billion e. the equilibrium level of real GDP demanded increases by $10 billion

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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If aggregate planned expenditure exceeds real GDP, then inventories Select one: A. decrease and real GDP decreases. B. decrease and real GDP increases. C. increase and real GDP increases. D. remain constant and real GDP remains constant. O E. increase and real GDP falls.
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Refer to the figure at right. The equilibrium level of real GDP will occur A. at point A. B. to the left of point A. C. to the right of point A. D. at the undetermined point on the graph depending upon the level of investment.
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In this graph, if firms are producing at level Y2, then inventories will _____, inducing firms to _____ production. a. rise; not change b. rise; increase c. remain unchanged; decrease d. remain unchanged; not change