Figure 11-1
?
In Figure 11-1, to reach the level of potential GDP, the administration of President Obama would most likely advocate
A. increasing Social Security payments.
B. decreasing defense spending.
C. decreasing personal income taxes.
D. All of the above are correct.
Answer: A
Economics
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If the marginal propensity to save is 0.4 and disposable income increases from $1,000 to $1,500, saving will increase
A) $300. B) $200. C) $100. D) $400.
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Which of the following will cause the money multiplier to become smaller?
A) an increase in high powered money B) a decrease in the ratio of reserves to checkable deposits C) an increase in the public's preference for checking deposits as opposed to holding currency D) a reduction in high powered money E) none of the above
Economics