Suppose There Is a Fiscal Contraction

question 21

Multiple Choice

Suppose there is a fiscal contraction.Which of the following is a complete list of the variables that must decrease?

• A)consumption
• B)consumption and investment
• C)consumption and output
• D)consumption, output and the interest rate
• E) consumption, output and investment

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Definitions:

Decision Tree

A graphical representation used in decision analysis to visually and explicitly represent decisions and decision making.

Expected Value

A calculated average of all possible values for a random variable, weighted by their probabilities of occurrence.

Receptive

Being open and willing to accept new ideas, suggestions, or changes.