Assume That the MPC Is 0

question 40

Multiple Choice

Assume that the MPC is 0.5.A $100-billion cut in taxes will shift the aggregate-demand curve to the:

• A)right by $500 billion
• B)right by $250 billion
• C)left by $250 billion
• D)none of the above

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Definitions:

1870

A year during the 19th century marked by various global events, including the completion of the Franco-Prussian War and the resultant unification of Germany.

Observational Learning

The process of acquiring knowledge and skills by observing and imitating others.

Operant Conditioning

A method of learning that employs rewards and punishments for behavior, encouraging the subject to associate certain behaviors with consequences.

Classical Conditioning

A learning strategy in which two stimuli are continually paired; the response that is initially attracted by the second stimulus is in time attracted by the first stimulus alone.