Assume That in a Private Closed Economy, Consumption Is $240

question 7

Multiple Choice

Assume that in a private closed economy, consumption is $240 billion and investment is $50 billion, both at the $280 billion level of domestic output. Thus,

• A) saving is $10 billion.
• B) unplanned decreases in inventories of $10 billion will occur.
• C) the MPC is 0.80.
• D) unplanned increases in inventories of $10 billion will occur.

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Definitions:

Mass Production

Manufactures a large number of uniform products with an assembly‐line system.

Service Delivery

The act of providing a service to customers, including all activities and processes that contribute to the service's effectiveness and quality.

Continuous-Process Production

A manufacturing method where the production process is uninterrupted to ensure efficient and scalable production of goods.

Automated Production

The use of automation technologies to perform manufacturing tasks and processes, reducing the need for human labor and increasing efficiency.