​ Beginning from Full-Employment Macro Equilibrium, Increase in Government Spending

question 23

Multiple Choice

​ Beginning from full-employment macro equilibrium, increase in government spending will cause real GDP to:

• A) ​increase in the short run.
• B) ​decline in the long run.
• C) ​decline in the short run.
• D) ​ increase in the long run.

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Definitions:

Recent Invoices

The latest billing statements or documents issued by a seller to a buyer, relating to a sale transaction and indicating the products, quantities, and agreed prices.

Full Disclosure Principle

The accounting principle that requires companies to fully disclose on their financial reports changes in accounting procedures and methods along with effects of the change as well as justification for change.

Inventory Valuation Method

The approach used to assess and report the value of a company's inventory, including methods such as FIFO (First In, First Out), LIFO (Last In, First Out), and average cost.

Financial Reports

Documents that provide an overview of a business's financial condition, including balance sheets, income statements, and cash flow statements.