Assuming That Investment,government Expenditures,and Net Exports Are All Autonomous,the Marginal

question 114

Multiple Choice

Assuming that investment,government expenditures,and net exports are all autonomous,the marginal propensity to consume for the economy represented in Figure 9.9 is

• A)1.0 since aggregate expenditure is a straight line.
• B)0.5.
• C)0.25.
• D)Indeterminate since there is no consumption function.

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Definitions:

Stated Value

The nominal value of a share of stock as determined by the issuing company, which may differ from its market value.

Common Stock

Shares entitling their holder to dividends that vary in amount and may even be missed, depending on the fortunes of the company.

Journal Entry

A record that captures the financial impact of a business transaction in the accounting system.

Stock Issuance

The process of making new shares available for sale by a company, often to raise capital.