Assume an economy is in equilibrium at an output level of $1,500 billion. If government spending increases by $200 billion, then at the output level of $1,500 billion, there is
A. an unplanned rise in inventories.
B. an unplanned inventory change of zero.
C. an unplanned fall in inventories.
D. either an unplanned increase or decrease in inventories depending on the value of the MPC.
Answer: C
Economics
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If the price of propane-fueled gas grills was to decrease, then
A) the demand for propane would decrease. B) the demand for propane would increase. C) the quantity of propane demanded would increase. D) the quantity of propane demanded would decrease.
Economics