Suppose the Price Level Is Fixed, the MPC Is 0

question 119

Multiple Choice

Suppose the price level is fixed, the MPC is 0.5, and the GDP gap is a negative $80 billion.To achieve full-employment output (exactly) , government should

• A)increase government expenditures by $80 billion.
• B)reduce government expenditures by $40 billion.
• C)reduce taxes by $40 billion.
• D)reduce taxes by $80 billion.

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Definitions:

Permanent Magnet Motors

Electric motors that use permanent magnets rather than electromagnets to generate the magnetic field required for rotation.

Lightweight Rotors

Rotors designed to reduce the overall mass, enhancing the mechanical efficiency and response of a system.

Ceiling Fans

Mechanical devices mounted on the ceiling of a room, designed to circulate air to cool or ventilate the space.

Servomotors

Specialized motors equipped with a feedback mechanism for precise control of angular or linear position, speed, and acceleration.