Suppose That the Government Could Stimulate Spending in One Expenditure

question 43

Multiple Choice

Suppose that the government could stimulate spending in one expenditure categories. In which category would the spending increase contribute MOST to an expansion of the country's production possibilities frontier?

• A) consumption goods
• B) government purchases
• C) net exports
• D) capital goods

---

Definitions:

Absolute Value

A mathematical function that measures the distance of a number from zero on the number line, denoted as |x|, regardless of direction.

Evaluate

To calculate the value of an expression by substituting the values of the variables and performing the operations.

Algebraic Expression

A combination of numbers, variables, and arithmetic operations that represents a mathematical phrase.

Simplify

The process of making an expression easier to understand by reducing it to its most basic form.