When comparing the autonomous expenditure multiplier in a closed-economy model to the autonomous expenditure multiplier in an open-economy model it can be concluded that
a. the multiplier in the open-economy model will be larger than in the closed-economy model.
b. the multiplier in the open-economy model will be smaller than in the closed-economy model.
c. both multipliers are the same.
d. None of the above.
B
Economics
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Both the perfectly competitive firm and the monopolistically competitive firm produce at the output where marginal revenue equals marginal cost (MR = MC) but only the perfectly competitive firm achieves allocative efficiency
Explain why this is the case.
Economics
If the price of tea rises relative to all other prices, consumers are likely to
A) buy more tea. B) buy less tea and more coffee. C) buy less coffee and less tea. D) buy less coffee.
Economics