Assume That the MPC Is

question 78

Multiple Choice

Assume that the MPC is .9 and investment falls by $30 billion.What is the change in real GDP?

• A)−$300 billion 
• B)−$270 billion 
• C)−$93 billion 
• D)−$39 billion

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Definitions:

Actual Costs

Actual costs are the expenses that a company incurs for producing goods or services, including materials, labor, and overhead, as opposed to estimated or budgeted costs.

Standard Costs

The predetermined costs of manufacturing a product or providing a service, used as benchmarks against actual costs.

Direct Materials Quantity Variance

The difference between the actual quantity of materials used in production and the expected quantity, multiplied by the standard cost per unit of material.

Malfunctioning Equipment

Equipment that is not operating correctly or as expected, often leading to operational inefficiencies or safety concerns.