An Increase in Exports Will Have What Effect on Aggregate

question 11

Multiple Choice

An increase in exports will have what effect on aggregate demand?

• A)It will decrease.
• B)It will increase.
• C)It may increase or decrease depending on the marginal propensity to import.
• D)It will have no effect on aggregate demand.

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Definitions:

Proposed Investment

A planned or suggested allocation of financial resources into a project or asset with an expectation of generating returns in the future.

Simple Rate Of Return

A financial metric that calculates the return on an investment without considering the time value of money, focusing on annual income and initial investment cost.

Straight-Line Depreciation

A method of allocating the cost of a tangible asset over its useful life in equal annual amounts, making for a simple depreciation calculation.

Proposed Investment

A prospective asset or capital outlay under consideration for its potential to generate income or appreciate in value.