Exhibit 23-5 -If Spending Was Equal to the Amount Corresponding to Point

question 174

Multiple Choice

Exhibit 23-5
-If spending was equal to the amount corresponding to point B in Exhibit 23-5,

• A)aggregate output would increase.
• B)aggregate output would decrease.
• C)spending is too high, and the expenditure line will shift down.
• D)the economy would be in equilibrium.
• E)the marginal propensity to consume would increase.

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Definitions:

Probability

The measure of the likelihood that an event will occur, expressed as a number between 0 (impossible) and 1 (certain).

Foreclosed

The legal process by which an owner's right to a property is terminated, usually due to failure to meet mortgage payment obligations.

Vickrey Auction

A sealed-bid auction where the highest bidder wins but pays the second-highest bid price.

Willingness To Pay

The maximum amount an individual is ready to spend for a good or service.