The Equilibrium Level of GDP in a Private Closed Economy

question 140

Multiple Choice

The equilibrium level of GDP in a private closed economy is where:

• A)MPC = APC.
• B)unemployment is about 3 percent of the labor force.
• C)planned consumption equals saving.
• D)saving equals planned investment.

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Definitions:

Shareholder Needs

The requirements or interests of individuals or entities that own shares in a corporation, often focused on return on investment.

Price Appreciation

The increase in the value of an asset or investment over time, not including the dividends or interest earned.

Current Income

The total amount of money earned within a specific time period, including wages, dividends, and interest.

Clientele Effect

The theory suggesting that changes in dividend policy will attract a different class of shareholders or cause the current shareholders to sell their shares.