To Simplify the Analysis, the Textbook Assumes That

question 9

Multiple Choice

To simplify the analysis, the textbook assumes that

• A)consumption is the only component of expenditures that responds to income and income is the only influence on consumption.
• B)consumption is the only component of expenditures that responds to government purchases and government purchases are the only influence on consumption.
• C)net exports are zero.
• D)there is no investment spending.
• E)expenditures change only because of changes in consumption.