If MPC = 0

question 183

Multiple Choice

If MPC = 0.9, equilibrium real GDP is $1,000, and full-employment real GDP is $2,000, then how much should government spending change to bring about full employment?

• A) +1,000.
• B) -100.
• C) +900.
• D) +100.
• E) -0.9.

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Definitions:

Association Areas

Areas within each lobe of the cortex responsible for the coordination and interpretation of information, as well as higher mental processing.

Sensory Messages

Information received by sensory organs and transmitted to the brain, where it is processed and interpreted.

Prefrontal Cortex

The front part of the frontal lobe of the brain, associated with decision making, planning, problem-solving, and control of social behavior.

Phineas Gage

Phineas Gage was a railroad construction foreman who survived an accident in the 19th century causing a large iron rod to pass through his brain, profoundly affecting his personality and behavior, and contributing to the understanding of the brain's role in personality and cognitive function.