Scenario 34-2

question 67

Multiple Choice

Scenario 34-2.The following facts apply to a small,imaginary economy.
• Consumption spending is $6,720 when income is $8,000.
• Consumption spending is $7,040 when income is $8,500.
-Refer to Scenario 34-2.For this economy,an initial increase of $500 in government purchases translates into a

• A)$1,388.89 increase in aggregate demand in the absence of the crowding-out effect.
• B)$3,125.00 increase in aggregate demand in the absence of the crowding-out effect.
• C)$1,135 increase in aggregate demand when the crowding-out effect is taken into account.
• D)$3,125.00 increase in aggregate demand when the crowding-out effect is taken into account.

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Definitions:

Printer

A peripheral device that converts digital documents and images into physical copies on paper or other media.

Output Methods

Various ways in which data or information can be presented, transferred, or made available to another process, device, or user.

Speakers

Devices that convert electrical audio signals into sound waves, enabling the playback of music, speech, and other sounds.

Interactive Whiteboards

Digital display boards that respond to user input either through touch or specialized pens, used in educational and corporate settings.