In a Simple Macro Model with Government and Demand-Determined Output,to

question 88

Multiple Choice

In a simple macro model with government and demand-determined output,to raise equilibrium national income by $100 billion,G must be

• A)raised by $100 billion.
• B)raised by $100 billion times the simple multiplier.
• C)raised by $100 billion divided by the simple multiplier.
• D)lowered by $100 billion times the simple multiplier.
• E)lowered by $100 billion divided by the simple multiplier.

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Definitions:

Tires

Manufactured products designed to cover wheels, providing traction and absorbing shock for vehicles.

Excess Supply

A situation where the quantity of a good or service supplied exceeds the quantity demanded at the current price, leading to surplus.

Sunglasses

Protective eyewear designed to prevent bright sunlight and high-energy visible light from damaging or discomforting the eyes.

Price

The amount of money expected, required, or given in exchange for something else; a fundamental economic concept that represents the value of a good or service.