Difficulty: Medium Figure 13-4

question 44

Multiple Choice

Difficulty: Medium Figure 13-4
-Refer to Figure 13-4. Let Y = real GDP, AE = Aggregate Expenditures, C = Consumption,
I_P = Planned Investment. Suppose AE = C + I_P, and I_P is autonomous. If potential real GDP is $7,000 billion, what must happen to planned investment for the economy to reach its potential real GDP?

• A) I_P must be decreased by $1,000 billion
• B) I_P must be increased by $1,000 billion
• C) I_P must be decreased by $500 billion
• D) I_P must be increased by $500 billion

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Definitions:

Brain Imaging Techniques

Methods used in neuroscience and psychology to visualize the structure and function of the brain, including MRI, CT scans, and PET scans.

Functioning

The action of operating or working in a proper or particular way.

Advantages

Benefits or favorable factors that enhance one's ability to succeed or achieve certain objectives.

Disadvantages

Negative or less favorable aspects, outcomes, or conditions that affect or impede someone or something.