An economy is at full employment. Which of the following events can create a recessionary gap?

In an open economy, the government purchases multiplier will be larger the

A) larger the marginal propensity to consume. B) smaller the marginal propensity to import. C) smaller the marginal income tax rate. D) All of the above are correct.

Suppose the Inkuyo family invests in the local bottling corporation. Albert, Brad, Carol, and Diana each invest separately. At the end of a very successful quarter, Carol and Brad receive a payment from the corporation equal to 10 percent of their investment. Albert receives 7 percent, but is paid before Carol or Brad. Diana receives 6 percent. If Diana receives her money before Albert, she must

have invested in a. common stock b. preferred stock c. convertible stock d. corporate bonds e. low-yield dividends