Refer to Figure 9.1. Assume the economy is initially at point A. The eventual change from a shock that increases investment expenditure is best represented by which long - run equilibrium combination of price level and real GDP? Figure 9.1 OA Pi Y2 OB. Pj Y, OC. Pi Y2 OD. Pz Y, Pe OP If the MPC = 0.8, an increase in investment spending from $35 billion to $38 billion will increase real GDP by O A. $3 billion. B. $3.75 billion. OC. $15 billion. O D. $24 billion.

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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Refer to Figure 9.1. Assume the economy is initially at point A. The eventual change from a
shock that increases investment expenditure is best represented by which long - run
equilibrium combination of price level and real GDP?
Figure 9.1
LRAS
OA Pz Y2
O B. P Y1
OC Pi Y2
OD. Pz Y,
SRAS
Real GOP
If the MPC = 0.8, an increase in investment spending from $35 billion to $38 billion will increase real GDP by
%3D
O A. $3 billion.
O B. $3.75 billion.
OC. $15 billion.
O D. $24 billion.
Transcribed Image Text:Refer to Figure 9.1. Assume the economy is initially at point A. The eventual change from a shock that increases investment expenditure is best represented by which long - run equilibrium combination of price level and real GDP? Figure 9.1 LRAS OA Pz Y2 O B. P Y1 OC Pi Y2 OD. Pz Y, SRAS Real GOP If the MPC = 0.8, an increase in investment spending from $35 billion to $38 billion will increase real GDP by %3D O A. $3 billion. O B. $3.75 billion. OC. $15 billion. O D. $24 billion.
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