(Table: Keynesian Equilibrium Analysis with Taxes and Net Exports) Given

question 171

Multiple Choice

(Table: Keynesian Equilibrium Analysis with Taxes and Net Exports) Given the data in the table, assume full employment income is $1,000 while the current equilibrium is $750. If the government wants to eliminate the recessionary gap while maintaining a balanced budget, it must increase spending by

• A) $100 and decrease taxes by $100.
• B) $250 decrease taxes by $250.
• C) $100 and increase taxes by $100.
• D) $250 increase taxes by $250.

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Definitions:

Cauda Equina

A bundle of spinal nerves and spinal nerve rootlets, resembling a horse's tail, located at the lower end of the spinal cord.

Filium Terminale

The filum terminale is a slender filament of connective tissue that extends from the tip of the spinal cord to the coccyx, anchoring the spinal cord in place.

Conus Medullaris

The tapered, lower end of the spinal cord, located around the first lumbar vertebra, marking the transition from the spinal cord to the cauda equina.

Cervical Enlargement

A widening in the upper part of the spinal cord that supplies nerves to the shoulders, arms, and hands.