The Figure Given Below Represents the Macroeconomic Equilibrium in the Aggregate

question 47

Multiple Choice

The figure given below represents the macroeconomic equilibrium in the aggregate income and aggregate expenditure framework.Assume that MPI is equal to zero. Figure 10.4 In the figure:
C: Consumption
I₁ and I₂: Investment
G: Government Spending
X: Exports
Refer to Figure 10.4.If autonomous government expenditures increase by $250 billion, equilibrium real GDP will:

• A)rise by $250 billion.
• B)fall by 300 billion
• C)rise by $500 billion.
• D)rise by $75 billion.
• E)rise by $100 billion.

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Definitions:

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Law passed by the English Parliament to control colonial trade and bolster the mercantile system, 1650–1775; enforcement of the act led to growing resentment by colonists.

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A key figure in English history, leading forces against the monarchy during the English Civil War and later serving as Lord Protector of the Commonwealth of England, Scotland, and Ireland.