If the Economy Has a Recessionary Expenditure Gap of $15

question 129

Multiple Choice

If the economy has a recessionary expenditure gap of $15 billion and the MPS is 0.3, then the equilibrium level of GDP is

• A)$16 billion below the full-employment level.
• B)$21 billion below the full-employment level.
• C)$50 billion below the full-employment level.
• D)$50 billion above the full-employment level.

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Definitions:

Not Common

Refers to something that is rare or not frequently encountered.

Independent Adoption

A privately arranged adoption, as when a doctor, lawyer, or other person puts a couple in contact with a pregnant woman desiring that her child be adopted.

Confidential Adoption

An adoption process where the birth parents' and adoptive parents’ identities remain sealed and private.

Legal Parents

Individuals who have a legal relation to a child, whether through biological connection, adoption, or other legal means.