Suppose the Government Share of GDP Is 20 Percent and the Consumption

question 38

Multiple Choice

Suppose the government share of GDP is 20 percent and the consumption, investment, and net export shares of GDP are 60, 15, and 5 percent, respectively. If, all else held constant, businesses become more optimistic about the benefits of investment, then

• A)investment spending as a share of GDP increases.
• B)the nongovernment share of GDP remains constant.
• C)the rate of interest increases.
• D)the government share of GDP remains at 20 percent.
• E)All of these

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Definitions:

Comparison Group

A group in a study that does not receive the experimental treatment and is used as a benchmark to measure the effect of the treatment.

Cross-Sequential Design

A research design that combines both cross-sectional and longitudinal methods to study how individuals of different ages change over time.

Surveys

Surveys are research methods that collect data from a predetermined group of respondents to gain information and insights on various subjects.

Evolutionary Theory

A scientific theory that proposes species change over time through processes like natural selection and genetic drift, explaining the diversity of life on Earth.