The Diagram Below Shows Desired Aggregate Expenditure for a Hypothetical

question 91

Multiple Choice

The diagram below shows desired aggregate expenditure for a hypothetical economy.Assume the following features of this economy:
∙ marginal propensity to consume (mpc) = 0.75
∙ net tax rate (t) = 0.20
∙ no foreign trade
∙ fixed price level
∙ all expenditure and income figures are in billions of dollars. FIGURE 22-2
-Refer to Figure 22-2.What is the equilibrium national income in this economy?

• A)$187.50
• B)$294
• C)$333.34
• D)$625
• E)$1666.67

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Definitions:

Independent Samples

Two or more groups of data that are collected from separate, non-related populations or entities.

Dependent Samples

Pairs of samples where the members of one sample are related or matched to the members of the other sample, often used in before-and-after studies.

Dependent-Samples T Test

A method in statistics for comparing the average differences between two related or matched groups to determine if the differences are not due to random chance.

Regression

A statistical method used to determine the relationship and predict outcomes between dependent and independent variables.