Figure 23-3 -Refer to Figure 23-3.Suppose That Government Spending Increases,shifting Up the Increases,shifting

question 79

Multiple Choice

Figure 23-3
-Refer to Figure 23-3.Suppose that government spending increases,shifting up the aggregate expenditure line.GDP increases from GDP1 to GDP2,and this amount is $200 billion.If the MPC is 0.8,then what is the distance between N and L or by how much did government spending change?

• A)$16 billion
• B)$40 billion
• C)$200 billion
• D)$1,000 billion

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Definitions:

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A notable example of a wooden Chinese pagoda, originating from the 11th century, located in Ying County, Shanxi Province.

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