If Investment Increases by $10 Billion and the Economy's MPC

question 65

Multiple Choice

If investment increases by $10 billion and the economy's MPC is 0.8, the aggregate demand curve will shift

• A) leftward by $50 billion at each price level.
• B) rightward by $10 billion at each price level.
• C) rightward by $50 billion at each price level.
• D) leftward by $40 billion at each price level.

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Definitions:

Skills or Ability

The developed capacities or proficiency that individuals possess which enable them to perform tasks effectively.

Income Differences

The disparities or variations in earnings and wealth among individuals or groups within a society.

Taste-for-Discrimination Model

An economic theory that explains how personal bias can lead to discrimination in hiring and wage decisions.

Discrimination Coefficient

A statistical measure used to analyze the degree of differentiation between variables or groups.