If the MPC equals 0.80 then:
a. the MPS equals 1.20.
b. the multiplier equals 0.20.
c. the multiplier equals 1 divided by 0.80.
d. the multiplier equals 5.
e. none of these.
d
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Equilibrium expenditure is the level of expenditure at which
A) aggregate planned expenditure minus planned changes in inventories equals real GDP. B) aggregate planned expenditure plus planned changes in inventories equals real GDP. C) firms' inventories are zero. D) firms produce more output than they sell. E) firms' inventories are at the desired level.
Dierdre just gave birth to twins and now finds herself buying diapers on a weekly basis. Therefore, we can conclude that there is a causal relationship between having newborn twins and purchasing diapers for Dierdre.
Answer the following statement true (T) or false (F)