Which of the Following Will Increase Investment Spending in the Economy,holding

question 179

Multiple Choice

Which of the following will increase investment spending in the economy,holding everything else constant?

• A)an increase in the federal government surplus
• B)an increase in the budget deficit
• C)an increase in consumer dissavings
• D)an increase in transfer payments

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Definitions:

Allocatively Efficient

An allocation status of resources where enhancing the welfare of one party means diminishing that of another.

Productive Inefficiency

A situation where resources are not utilized in the best possible way, leading to wasted potential output or higher costs than necessary.

Profit-Maximizing Output

The level of production at which a firm achieves the highest possible profit, determined by the point where marginal revenue equals marginal cost.

Minimum Level

The Minimum Level refers to the least amount, extent, or degree that is acceptable or achievable in a specific context.