If an Economy Is Operating at a Point on the C

question 71

Multiple Choice

If an economy is operating at a point on the C + I line that lies above the 45-degree line

• A) the economy is in equilibrium.
• B) the C + I line shifts down.
• C) GDP will rise.
• D) unwanted inventories will accumulate.
• E) intended saving equals intended investment.

---

Definitions:

Missile Gap

The claim, raised by John F. Kennedy during his campaign for president in 1960, that the Soviet Union had developed a technological and military advantage during Eisenhower’s presidency.

The Beats

A group of American writers and artists in the 1950s who explored and influenced American culture and politics with their unconventional literary style and countercultural beliefs.

Consumerism

The preoccupation with and an inclination towards the buying of consumer goods.