An Increase in the Marginal Propensity to Import Will

question 55

Multiple Choice

An increase in the marginal propensity to import will

• A)raise imports and raise equilibrium income.
• B)lower imports and raise equilibrium income.
• C)lower the multiplier and reduce equilibrium income.
• D)raise the multiplier and reduce equilibrium income.

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Definitions:

Type

A category or class that individuals or things can be grouped into based on shared characteristics or qualities.

Implied Warranty

A legal term for the unspoken and unwritten guarantees that the law assumes goods or services must meet.

Trade Custom

Established practices and patterns of behavior that are widely accepted within a particular industry.

Contract

A contract between two or more entities that is recognized by law and entails shared responsibilities.