In an Open Economy with Government and Demand-Determined Output,a Decrease

question 131

Multiple Choice

In an open economy with government and demand-determined output,a decrease in the equilibrium level of national income could be caused by

• A)a decrease in taxes at all levels of income.
• B)a decrease in the desired level of imports at all levels of income.
• C)a decrease in desired consumption at all levels of income.
• D)a decrease in the desired level of saving at all levels of income.
• E)an increase in government purchases.

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Definitions:

Accounts Receivable Approach

A method used to estimate the value of a firm's accounts receivable and gauge the potential for uncollectible invoices.

Net Present Value

A financial metric that calculates the present value of all cash flows associated with a project or investment, considering both inflows and outflows, to assess its profitability.

Monthly Interest Rate

The interest rate applied to a loan or debt on a monthly basis, often used for calculating monthly payments on a loan.

Carrying Cost

The total cost of holding inventory, including storage, insurance, taxes, and opportunity costs, but not limited to these.