Use Table 10 $\text { Table } 10.3$ If Full-Employment Income Were $400 Billion Per Year in Table

question 106

Multiple Choice

Use Table 10.3,which shows the relationship between consumption and income.Assume the price level is constant. $\begin{array}{ll}\text { Disposal Income } & \text { Total Consumption }& \text { Investment }& \text { Total Expenditure }\\\text { (Billions per Year) }& \text { (Billions per Year) }& \text {(Billions per Year) }& \text { (Billions per Year) }\\\hline\$ 0 & \$ 200 & \$ 100 &\_\_\_\\200 & 300 & 100&\_\_\_ \\400 & 400 & 100&\_\_\_ \\600 & 500 & 100&\_\_\_\end{array}$

$\text { Table } 10.3$ If full-employment income were $400 billion per year in Table 10.3,

• A)There would be an inflationary gap.
• B)Full-employment income would equal equilibrium income.
• C)There would be a recessionary gap.
• D)Further information is needed to determine equilibrium income.

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Definitions:

Commitment probability

The likelihood that an individual will remain dedicated to a task, goal, or relationship over time.

Variant of authority decisions

Different forms or approaches to making decisions based on established power or authority within an organization.

Vroom, Yetton, and Jago

A model of decision-making that focuses on leadership and outlines how leaders can evaluate the situation and determine the level of involvement from subordinates in the decision-making process.

Manager sharing the problem

A leadership approach where managers involve their team in problem-solving processes to encourage ownership and diverse input.