In a Simple Economy in Which Prices Are Constant and with No

question 65

Multiple Choice

In a simple economy in which prices are constant and with no income taxes or imports, the marginal propensity to save is 0.2. If exports increase $50, what impact will that have on aggregate expenditure?

• A) increase by $250
• B) decrease by $250
• C) decrease by $100
• D) increase by $100

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Definitions:

Self-Efficacy

An individual's belief in their own capability to complete tasks and reach goals.

Self-Help Books

Publications designed to offer guidance on personal improvement and to address personal challenges.

Major Depression

A psychological condition marked by a constant state of sadness or a lack of enthusiasm in tasks, resulting in considerable disruption to daily functioning.

Systematic Desensitization

A behavioral therapy technique aimed at reducing phobic or anxiety responses by gradually exposing the patient to the feared object or situation.