Refer to the Following Table When Answering
Table 11

question 70

Multiple Choice

Refer to the following table when answering
Table 11.1: Real Growth Rates: 1950-2012
$$\begin{array} { l c c } \hline & \text { Mean } & \text { St Dev } \\\hline \text { Output } & 3.26 & 2.71 \\\text { Household Consumption } & 3.37 & 2.15 \\\text { Firm Investment } & 4.60 & 12.72 \\\text { Government Expenditures } & 2.76 & 6.15 \\\hline\end{array}$$
-You are given the data in Table 11.1, which covers the period 1950-2012. "Mean" is the average growth over the period and "St Dev" is the standard deviation of the growth (a measure of volatility) of real output, consumption, investment, and government expenditures. From this information, you conclude that:

• A) households smooth their consumption more than other sectors
• B) firms do not base their decisions on more than the potential GDP
• C) foreigners are fickle consumers
• D) government expenditures are zero
• E) government expenditures are constant