If the MPC Is 0

question 19

Multiple Choice

If the MPC is 0.50 and the equilibrium GDP is $40 billion below the full-employment GDP, then the size of the recessionary expenditure gap is

• A)$40 billion.
• B)$20 billion.
• C)$60 billion.
• D)$80 billion.

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Definitions:

Depression

A mood disorder typified by ongoing dejection or indifference toward life’s activities, profoundly impairing everyday functionality.

Mania

A mental state characterized by excessively high energy levels, euphoria, hyperactivity, and sometimes delusions of grandeur, often seen in bipolar disorder.

Schizophrenic Person

An individual diagnosed with schizophrenia, a mental disorder characterized by disruptions in thought processes, perceptions, emotional responsiveness, and social interactions.

Catatonic

A state often seen in severe psychiatric conditions marked by either immobility or excessive motor activity, sometimes with peculiar posturing.