In the Third Quarter of 2008, Investment in the U

question 469

Multiple Choice

In the third quarter of 2008, investment in the U.S. totaled $1.4 trillion and in 2007, investment was $1.3 trillion. In addition, third quarter real GDP was $11 trillion. Suppose the MPC in the U.S. is 0.80. Ignoring the effects of imports and taxes, the multiplier is ________ and the change in investment will decrease equilibrium expenditure by ________.

• A) 2; $1 trillion
• B) 5; $1 trillion
• C) 2; $200 million
• D) 5; $500 million

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Definitions:

Forward

Directional term referring to the front or direction in which an individual or structure is facing or moving.

Tachypnea

Rapid breathing; an increased respiratory rate which may be a sign of distress or a symptom of a medical condition.

Rapid Breathing

An increased rate of respiration, which can be a symptom of various conditions including anxiety, infection, or respiratory disorders.

Ana-

A prefix in medical terminology meaning "up," "back," "again," or "excessive."