Whenever there is an increase in autonomous consumption spending, there will be
a. an upward shift of the aggregate expenditure line causing equilibrium GDP to rise
b. an upward shift of aggregate expenditure line, but no change in equilibrium GDP
c. no change in the aggregate expenditure line, but equilibrium GDP will rise
d. an upward shift of the aggregate expenditure line, causing equilibrium GDP to fall
e. no change in the aggregate expenditure line or equilibrium GDP
A
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Every point on an open-economy IS curve represents:
A) combinations of interest rates and the supply of money, which result in equilibrium in the money market. B) combinations of interest rates and levels of production, which result in equilibrium in the goods market. C) combinations of interest rates and levels of production, which result in equilibrium in the money market, the goods market, and the forex market. D) combinations of interest rates and levels of production, which result in equilibrium in the goods market and the forex market.
Food stamps provided by the U.S. Department of Agriculture are an example of
A) a positive externality. B) a private subsidy. C) vouchers. D) an external benefit.