Question 8 When an increase in the rate of growth causes a correspondingly larger increase in the rate of investment this is known as a positive output gap. a budget surplus. the multiplier. D the accelerator. A B C

Q: A rightward shift of the investment demand curve would be caused by a(an) a. increase in the…

A: Investment demand is constructed to depict the relationship between the interest rate and amount of…

Q: Suppose that there’s a recessionary gap, and the country wishes to produce its potential output.…

A: Recession refers to the stage where GDP decrease,  rising unemployment rates, reduced consumer…

Q: The figure represents the consumption function for a consumer. The distance between C and D…

A: The diagram represents the consumption curve. The yellow line is the planned real consumption curve…

Q: Disposable income ________ when ________. a.decreases; taxes increase b.decreases; transfer…

A: Disposable income is a part of total earned income of households, which they can use to save and…

Q: Country X has following data: C = 20 + 0.8Y4, I = 30, G = 40, T, = 20, T, = 15, X = 60, M = 20 +…

A: Here we calculate the following terms by using the given function and conclude the solution so the…

Q: a. Identify three government policies that discourage saving.

A: We will answer the first question since the exact one was not specified. Please submit a new…

Q: A temporary increase in government expenditure will a. Shift the saving curve to the right b.…

A: Government expenditure (G): - government expenditure is the spending made by the government on the…

Q: Answer the following questions:   Instructions: Enter your answers rounded to the nearest whole…

A: Given :  MPC = 0.9 Increase in investment by $11 billion

Q: An increase in autonomous investment spending will likely cause ___________

A: Spending multiplier is the ratio of change in equilibrium GDP due to change in autonomous spending.…

Q: The catch-up effect refers to the idea that Select one: O a. If investment spending is low,…

A: The catch-up effect is a theory in macroeconomics. Economics is divided into two parts;…

Q: A reduction in personal income taxes increases Aggregate Demand through   a. an increase in private…

A: Aggregate demand is the economic concept that helps in understanding the quantity demanded by all…

Q: 1. Assume that the economy is in a steady state and there is an unexpected permanent increase in the…

A: You are assuming that the economy is in a steady state and there is an unexpected permanent increase…

Q: Disposable income ________ when ________. a. decreases; taxes increase b. decreases; transfer…

A: DISPOSABLE INCOME IS A NET INCOME , IT IS THE AMOUNT LEFT OVER AFTER TAX. IT IS ALSO KNOWNS AS…

Q: 5.The MPC is a.marginal propensity to change b.marginal propensity to consume c.multiple platform to…

A: The objective of the question is to identify the correct full form of the acronym 'MPC' in the…

Q: Increase in tax by the government: a. None of these b. Decreases the consumption by individuals c.…

A: When government increases taxes, the disposable income of the people tends to reduce. In other…

Q: The multiplier is the ratio of the change in ________ to a change in ________. Select one: a. the…

A: The multiplier (K) can be calculated using the following formula.

Q: usually increase(s) when the U.S. 4) economy is in a recession and decrease(s) when the U.S. economy…

A: Consumer spending usually falls in recession and rises when the economy is expanding. Hence, option…

Q: An increase in planned investment causes :Select one a. output to decrease, but by a smaller .amount…

A: In an economy, when planned investment increases then it cause the output to decrease by a smaller…

Q: Interest rate 4% 2 + $50 500 530 02 D₁ Savings, investment, government borrowing (millions of…

A: When a nation is in a recession, the working of the government takes on added significance as it…

Q: 49. What could increase investment spending?     a) An increase in inflation.     b) An increase…

A: The correct option is    e) A technological breakthrough creating new products or improving…

Q: Disposable income is the amount a household has  A   after subtracting autonomous spending. B…

A: Disposable income is the income the consumer has which is available for spending.

Q: T/F/U. To counterbalance a decrease in investment during a recession, governments offer tax credits…

A: The macroeconomic tools which the government uses to  intervene and correct any imbalances in the…

Q: The following table shows data for the economy before the decrease in saving. Suppose that the…

A: Total expenditure is the sum of consumption (C), investment (I), government purchases (G) and net…

Q: d. Suppose that society decided to reduce consumption and increase investment. What groups might…

A: Consumption is the measure of the health of the demand side of the economy, whereas investments…

Q: Problem 1. Given the saving function S =- 10 + 0.2y and autonomous investment, I=35 crore. (i) Find…

A: At equilibrium, savings=investment and savings function is: S=-C¯+(MPS×Y) where C bar is an…

Q: QUESTION 21 What is the marginal propensity to consume? O a. The ratio of the change in consumption…

A: The aggregate expenditure schedule in a country's economy represents projected expenditure by…

Q: Assuming there is no government or foreign sector, [1 / 1- MPC] represents a. the consumption…

A: Multiplier refers to the relation when there is an increase in economic factor which causes change…

Q: What is the multiplier effect in economics? A. The tendency of consumers to save rather than spend…

A: The multiplier effect is a major idea in macroeconomics, playing a basic role in how economies…