If the MPC changed from 0.8 to 0.6, then the spending multiplier would change from
a. 5 to 2.5

Which of the following is a positive economic statement?

a. reducing unemployment should be the highest priority of the federal government. b. a reduction in the payroll tax will reduce the unemployment rate. c. corporations should be prohibited from laying off workers during a recession. d. the current unemployment rate is too high.

Suppose that an individual can hold her wealth in only two forms: money and bonds. A _______________ in the bond market would then imply that there is a ________________ in the money market

A) surplus; surplus B) shortage; shortage C) surplus; shortage D) shortage; surplus E) c and d