If Planned Aggregate Expenditure (PAE)in an Economy Equals 2,000

question 14

Multiple Choice

If planned aggregate expenditure (PAE) in an economy equals 2,000 + 0.48Y and potential output (Y*) equals 4,000,then this economy has

• A) an expansionary gap.
• B) a recessionary gap.
• C) no output gap.
• D) an income-expenditure multiplier equal to 5.
• E) an income-expenditure multiplier equal to 9.

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Definitions:

Neural Crest Cells

Embryonic cells that give rise to a diverse cell lineage including melanocytes, craniofacial cartilage and bone, and peripheral and enteric neurons and glia.

Telencephalon

Anterior division of the embryonic brain from which the cerebral hemispheres develop.

Neural Tube

An embryonic structure that develops into the brain and spinal cord.

Anencephaly

Defective development of the brain and absence of the bones of the cranium. Only a rudimentary brainstem and a trace of basal ganglia are present.