If the Government Wishes to Increase the Level of Real

question 6

Multiple Choice

If the government wishes to increase the level of real GDP, it might reduce

• A)taxes.
• B)transfer payments.
• C)the size of the budget deficit.
• D)its purchases of goods and services.

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Definitions:

Statistical Power

The probability that a test will correctly reject a false null hypothesis; a measure of a test's ability to detect an effect, if there is one.

Type II Error

The statistical mistake of failing to reject a false null hypothesis, also known as a false negative.

Sample Size

The number of observations or items selected from a larger population for the purpose of statistical analysis.

Directional Hypothesis

A hypothesis that specifies the direction of the expected difference or relationship.