Consider a Simple Macro Model with a Constant Price Level

question 144

Multiple Choice

Consider a simple macro model with a constant price level and demand-determined output.In such a model,a downward shift of the saving function causes equilibrium national income to

• A)fall because the AE function shifts downward simultaneously.
• B)rise because the AE function shifts upward simultaneously.
• C)remain constant but consist of more consumption and less investment.
• D)remain constant but consist of less consumption and more investment.
• E)remain constant because it does not affect desired aggregate expenditure.

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Definitions:

Obscene Material

Content considered offensive or inappropriate by the standards of public decency and morality, often sexual in nature, and regulated by law in many jurisdictions.

Political Environment

The context created by political institutions, processes, and activities that influence the operation of societies and businesses.

Fair Trade Commission

The Fair Trade Commission is a government agency responsible for promoting fair business practices and competition by enforcing laws related to antitrust and consumer protection.

U.S. Interstate

A network of controlled-access highways that form part of the National Highway System in the United States.