In the Basic Keynesian Model, an Increase in Government Purchases

question 79

Multiple Choice

In the basic Keynesian model, an increase in government purchases:

• A)reduces short-run equilibrium output.
• B)increases short-run equilibrium output.
• C)reduces potential output.
• D)increases potential output.

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Definitions:

Researcher

An individual who conducts scientific studies in order to advance knowledge in a particular field, often through experiments, observations, and data analysis.

Socially Desirable

Pertaining to actions or behaviors that are widely accepted, admired, or valued in a social context.

Respond

To give an answer or reaction to a stimulus or situation.

Acquiescence Response Set

A tendency for respondents to agree with statements as presented to them, regardless of the content.