Which of the following is illustrated by the distance between the aggregate expenditure line and the 45-degree line at each level of real GDP?
a. The level of saving in an economy
b. Unplanned inventory change
c. Planned investment undertaken in an economy
d. The marginal propensity to save
e. The marginal propensity to consume
b
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One advantage of a money market mutual fund account is that: a. it is guaranteed for a larger amount than are FDIC-insured deposits
b. it is a riskless asset. c. its holders typically earn more interest than they can with a regular bank account. d. it earns high interest and is liquid. e. it is completely liquid and riskless.
Suppose technical change permits cable television companies to provide their services at lower rates. The share-the-gains, share-the-pains theory would predict that the regulators would
A) permit the firms to keep the savings and would lower prices only if the firms were pressured to do so. B) force the firms to pass all the savings on to consumers in the form of lower prices. C) force the firms to pass the savings on to consumers in the form of better service. D) force the firms to pass some of the savings on to consumers and to permit the firms to keep some of the savings themselves.