In the Keynesian Cross Diagram,a Decline in Autonomous Consumer Expenditure

question 113

Multiple Choice

In the Keynesian cross diagram,a decline in autonomous consumer expenditure causes the aggregate demand function to shift ________ and the equilibrium level of aggregate output to ________,everything else held constant.

• A)up;rise
• B)up;fall
• C)down;rise
• D)down;fall

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Definitions:

Net National Product

The total value of goods and services produced by a country's citizens, adjusted for depreciation; it reflects the nation's overall economic productivity after wear and tear on assets.

Profit-maximizing Condition

The state or point at which a business achieves the highest level of profit with the least amount of cost, often by equating marginal cost and marginal revenue.

Role Of Government

The activities undertaken by a government to regulate and guide the economy, including policy-making, taxation, and spending.

Unemployment Level

The number or percentage of the labor force that is without work but actively seeking employment.