Use the Following Graph to Answer the Next Four Questions

question 40

Multiple Choice

Use the following graph to answer the next four questions.

-Suppose that the level of capital is 100,000,the depreciation rate is 5%,and investment is equal to 5,000.In this case,you would expect that:

• A) real gross domestic product (GD
• P) will increase.
• B) real GDP will decrease.
• C) real GDP will remain unchanged.
• D) the steady state value of capital will increase.
• E) the steady state value of capital will decrease.

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Definitions:

Magic Number

Often referencing Miller's law, which suggests the number 7 (plus or minus 2) represents the amount of information a typical human memory can hold in the short term.

Working Memory

A cognitive system responsible for temporarily holding and processing information needed for complex tasks such as learning, reasoning, and comprehension.

Cognitive Processes

Mental processes involved in gaining knowledge and comprehension, including thinking, knowing, remembering, judging, and problem-solving.

Acquisition

The processes of gaining new information and placing it in memory.