Consider a Simple Macro Model with a Constant Price Level

question 63

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

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Definitions:

Null Hypothesis

A statement positing that there is no significant difference between specified populations, any observed difference being due to sampling or experimental error.

Bootstrap Resamples

Sampling method involving repeatedly drawing samples, with replacement, from a dataset to estimate the distribution of a statistic.

P-value

The likelihood of seeing a test statistic as extreme or more extreme than the one measured, assuming the null hypothesis holds.

Bootstrap Distribution

A data-driven simulation method for estimating the sampling distribution of an estimator by resampling with replacement from the original data.