Taxes, savings, and imports tend to magnify the effect of any spending change in the economy; that is, if investment spending initially increases, then spending will grow even more as taxes, savings, and imports increase, so the economic growth will accelerate

The budget constraint for a consumer who only buys apples (

A) and bananas (B) is PAA + PBB = I where consumer income is I, the price of apples is PA, and the price of bananas is PB. To plot this budget constraint in a figure with apples on the horizontal axis, we should use a budget line represented by the slope-intercept equation: A) A = -I/PA + (PB/PA)B B) A = I/PA - (PB/PA)B C) B = -I/PB + (PA/PB)A D) B = I/PB - (PA/PB)A

________: goods for which consumption falls (rises) when income increases (decreases)

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