In an Economy Described by the Assumptions of the Simple

question 15

Multiple Choice

In an economy described by the assumptions of the simple Keynesian Model,the impact of fluctuations in autonomous investment on consumption spending could be

• A)caused by government tax and spending policies.
• B)explained by changes in output,Y.
• C)endogenous.
• D)offset by government tax and spending policies.

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Definitions:

Financial Institutions

Organizations that provide financial services, including banks, insurance companies, and investment firms.

Financial Markets

Financial institutions through which savers can directly provide funds to borrowers

Investment

The allocation of resources, often money, in the hope of generating an income or profit.

Real GDP

The measure of a country's gross domestic product adjusted for inflation, reflecting the value of all goods and services produced at constant prices.