If the marginal propensity to consume is 0.8 and aggregate expenditures initially decrease by $200 million, then the aggregate demand curve will shift ________ , holding the price level constant
a. inward by $1 billion
b. outward by $1 billion
c. inward by $200 million
d. outward by $200 million
a
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Researchers believe that the economy grows at least one percentage point less annually when:
a. the ratio of public debt to GDP exceeds 90 percent for at least five years in a row. b. the ratio of public debt to GDP exceeds 50 percent for at least two years in a row. c. the growth rate of population falls for at least five years in a row d. the rate of inflation is below 4 percent for at least two years in a row. e. the growth rate of real interest rates falls for at least five years in a row.
The cross price elasticity of demand is defined as
A) the percentage change in the supply for one good (a shift in the supply curve) divided by the percentage change in price of a related good. B) the percentage change in demand for two different commodities. C) the percentage change in the demand for one good (a shift in the demand curve) divided by the percentage change in price of a related good. D) the percentage change in price for two different commodities.