In an Economy, the Government Wants to Increase Aggregate Demand

question 30

Multiple Choice

In an economy, the government wants to increase aggregate demand by $60 billion at each price level to increase real GDP and reduce unemployment.If the MPC is .9, then it could:

• A)decrease taxes by $6 billion.
• B)decrease taxes by $12 billion.
• C)increase government spending by $6 billion.
• D)increase government spending by $12 billion.

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Definitions:

Account Penetration

The process of deepening relationships with existing customers by selling more products or services.

Transactional Relationship

A business relationship focused primarily on the exchange of goods or services for payment, with little personal connection.

Distinct Component

a unique and identifiable part of a larger system or product, which serves a specific function and is often necessary for the overall operation or effectiveness.

Sales Call

A communication, either via telephone or face-to-face, initiated by a salesperson towards a potential or existing customer with the objective of making a sale.