Figure 12-3 -Refer to Figure 12-3.Suppose That Investment Spending Decreases by $5

question 284

Multiple Choice

Figure 12-3
-Refer to Figure 12-3.Suppose that investment spending decreases by $5 million,decreasing aggregate expenditure and decreasing real GDP from GDP₂ to GDP₁.If the MPC is 0.8,then what is the change in GDP?

• A)-$4 million
• B)-$5 million
• C)-$25 million
• D)-$40 million

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Definitions:

Niche-Market Approach

A marketing strategy that targets a specific, well-defined segment of the market.

Market Segmentation

A strategy whereby a firm divides the total market into groups of people who have relatively similar product needs.

Market Positioning

The process of establishing the image or identity of a brand or product so that consumers perceive it in a certain way relative to competitors.