If a "Conservative" Wanted to Increase Aggregate Demand, Which of the Following

question 140

Multiple Choice

If a "conservative" wanted to increase aggregate demand, which of the following would he or she tend to favor?

• A)An increase in government spending, because it has a larger multiplier than tax changes.
• B)A decrease in transfer payments, because it keeps the public sector small.
• C)An increase in transfer payments, because it has a larger multiplier than tax changes.
• D)A decrease in taxes, because it makes the public sector smaller.

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Definitions:

Three Decimal Places

Refers to a numerical value rounded or fixed to have exactly three digits to the right of the decimal point.

\(70e^{-0.5x}\)

An exponential function representing growth or decay, where 70 is the initial quantity and \(-0.5x\) adjusts the rate of increase or decrease.

Real Number

A figure that indicates a quantity on an unbroken scale, comprising both rational and irrational numbers.

Horizontal Asymptote

A horizontal line that a graph approaches as the input or output values become infinitely large in absolute value.