If the MPS Is 1/3, a $200 Increase in Net

question 105

Multiple Choice

If the MPS is 1/3, a $200 increase in net exports will

• A) reduce real Gross Domestic Product (GDP) by $600.
• B) reduce real Gross Domestic Product (GDP) by $300.
• C) increase real Gross Domestic Product (GDP) by $300.
• D) increase real Gross Domestic Product (GDP) by $600.

Recognize the impact of federal budget choices on economic indicators like aggregate demand and national saving.

Identify legislative and hypothetical actions to manage or reform the federal budget process.

Understand the fiscal year definition and its significance in budget planning.

Know the differences among various federal government spending categories and their economic impacts.

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Definitions:

Positive Feedback

A process in which an initial change leads to further changes that reinforce the initial one, often leading to amplification of the effect.

Dams

Structures built across rivers or streams to restrict the flow of water, typically for the purposes of water storage, flood management, or electricity generation through hydropower.

Inexpensive

Items or services that are low in cost, making them accessible to a wide range of consumers.

Desalination

The process of removing salt and other minerals from seawater to produce fresh water suitable for human consumption or irrigation.