Consider a Model in Which Output Is Demand-Determined

question 114

Multiple Choice

Consider a model in which output is demand-determined.If the marginal propensity to spend out of national income is 0.4,then a $0.6 billion decrease in government purchases will cause equilibrium national income to ________ by approximately ________.

• A)decrease; $1.50 billion
• B)decrease; $1.00 billion
• C)decrease; $0.24 billion
• D)increase; $1.00 billion
• E)increase; $1.50 billion

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Definitions:

Personalized Messaging

The practice of tailoring marketing messages and communications based on individual consumer data, preferences, and behavior.

Complementary Role

The function or position of one component or person that supports or enhances the functions or positions of another within an operation or process.

Cross-over Effect

The phenomenon where the success or attributes of one product or brand spills over to another within the same company.

Merchant Wholesaler

A business that buys goods in large quantities from manufacturers and resells them to retailers or other businesses.