According to the Traditional Keynesian Approach, If the Government Increases

question 3

Multiple Choice

According to the traditional Keynesian approach, if the government increases spending by $5 million and raises current taxes by $5 million at the same time, then

• A)real GDP will increase by $5 million.
• B)real GDP will decrease by $5 million.
• C)real GDP will decrease by more than $5 million.
• D)real GDP will remain the same.

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Definitions:

Basilar Membrane

A critical structure in the cochlea of the inner ear, it plays a pivotal role in sound detection by vibrating in response to different frequencies.

Cranial Nerve VIII

Also known as the vestibulocochlear nerve, it is responsible for hearing and balance.

Perilymph

The fluid that fills the space between the membranous labyrinth and the bony labyrinth of the inner ear.

Static Equilibrium

A state where an object is at rest, and all the forces acting upon it are balanced.