Use the Following to Answer Questions

question 6

Multiple Choice

Use the following to answer questions .
Exhibit: Aggregate Expenditures and Real GDP 1
-(Exhibit: Aggregate Expenditures and Real GDP 1) Let Y = real GDP, AE = Aggregate Expenditures, C = Consumption, I_P = Planned Investment. Suppose AE = C + I_P. I_P is autonomous and the consumption function is C = $1,000 billion + 0.5Y. What is the amount of consumption when real GDP is $6,000 billion?

• A) 1,000 billion
• B) 2,000 billion
• C) 3,000 billion
• D) 4,000 billion

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Definitions:

Egocentric

This term describes a cognitive perspective where an individual is unable to differentiate between their own viewpoint and that of others.

Sponge

An object or organism able to absorb liquid quickly; metaphorically, a person who absorbs information readily.

Rock

A naturally occurring solid aggregate of minerals or mineral-like substances.

Decentered Thinking

Refers to the ability to consider multiple aspects of a situation simultaneously, characteristic of more advanced stages of cognitive development.