In Macroland,planned Aggregate Expenditure Equals 100,000 + 0

question 42

Multiple Choice

In Macroland,planned aggregate expenditure equals 100,000 + 0.5Y.If autonomous government purchases increase by 5000,short-run equilibrium output will change from

• A) 100,000 to 100,200
• B) 200,000 to 205,000
• C) 205,000 to 210,000
• D) 200,000 to 210,000
• E) 800,000 to 800,100

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Definitions:

Absorption Costing

An accounting method that includes all of the manufacturing costs in the cost of a product, including direct labor, materials, and overhead.

Variable Costing

A costing method that includes only variable manufacturing costs—direct materials, direct labor, and variable manufacturing overhead—in unit product costs.

Income Statement

A financial statement that shows a company's revenues and expenses over a specific period, resulting in a profit or loss.

Variable Costing

An accounting method that considers only variable costs as product costs and treats fixed costs as period costs that are expensed in the period incurred.