Exhibit 12-2 -In an Economy Characterized by the Aggregate Expenditure Line in Expenditure

question 102

Multiple Choice

Exhibit 12-2
-In an economy characterized by the aggregate expenditure line in Exhibit 12-2, how would a $100 increase in autonomous net taxes impact real GDP?

• A)decrease real GDP by $200
• B)decrease real GDP by $100
• C)no impact on real GDP
• D)increase real GDP by $100
• E)increase real GDP by $200

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Definitions:

Market Price

The ongoing rate at which a product or service is traded in a certain market.

Ownership Position

The share or portion of a company or property owned by an individual or entity, often expressed as a percentage of the total available shares.

Shares Outstanding

The total number of shares of a company's stock that are currently owned by all shareholders, including share blocks held by institutional investors and restricted shares owned by the company’s officers and insiders.

Market Price

The immediate market rate for purchasing or selling an asset or service.