Suppose That Investment Decreases by $15 Billion

question 156

Multiple Choice

Suppose that investment decreases by $15 billion. If the multiplier is 2, and the short-run aggregate supply curve is positively sloped. In the short run, equilibrium real GDP

• A)decreases by $30 billion.
• B)decreases by more than $30 billion.
• C)decreases by less than $30 billion.
• D)increases by less than $30 billion.
• E)does not change.