Suppose That the Level of GDP Increased by $100 Billion

question 128

Multiple Choice

Suppose that the level of GDP increased by $100 billion in an economy where the marginal propensity to consume is 0.5.The initial change in spending must have been:

• A)$100 billion.
• B)$50 billion.
• C)$500 billion.
• D)$5 billion.

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Definitions:

Restless

A state of unease or inability to remain still or quiet, often leading to constant movement or the desire to be constantly busy.

Fidgety

Exhibiting restless or nervous movements, often as a result of impatience, boredom, or anxiety.

Temperament

An individual's innate disposition or behavioral style and characteristic emotional response.

Slow-To-Warm-Up

Describes a temperament where individuals are initially hesitant in new situations or with unfamiliar people, but gradually become more comfortable over time.