If Government Purchases Decrease, in the Short Run

question 73

Multiple Choice

If government purchases decrease, in the short run

• A)consumption will increase as income increases.
• B)consumption, investment, and net exports will increase as income increases.
• C)consumption and investment will increase as income increases.
• D)consumption will fall and net exports will increase as income falls.
• E)consumption will increase, and real GDP will remain at potential GDP.

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Definitions:

Hippocampus

A region of the brain that plays a major role in memory formation and spatial navigation.

Macular Degeneration

A medical condition which results in blurred or no vision in the center of the visual field due to aging, leading to damage to the retina and is a major cause of blindness and visual impairments in older adults.

Blindness

The condition of lacking visual perception due to physiological or neurological factors.

Colorblindness

A visual impairment where an individual has difficulty distinguishing between certain colors, typically red and green, due to the absence or malfunctions of color-detecting cells in the eye.