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You Are Given the Following Information About Aggregate Demand at the Existing

question 213

Multiple Choice

You are given the following information about aggregate demand at the existing price level for an economy: (1) consumption = $400 billion; (2) investment = $40 billion; (3) government purchases = $90 billion; and (4) net export = $25 billion.If the full-employment level of GDP for this economy is $600 billion, then what combination of actions would be most consistent with the goal of achieving full employment?


Definitions:

Marginal Utilities

The supplementary pleasure or value a consumer secures by acquiring one more unit of a product or service.

Total Utility

The total satisfaction or benefit that a consumer receives from consuming a given quantity of goods or services.

Current Consumption

The amount of goods and services consumed by individuals or households in the present period.

Marginal Utility

Additional contentment or usefulness achieved through the use of one more unit of a good or service.

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