An increase in government purchases, ceteris paribus, will
A) increase public saving. B) reduce investment.
C) increase the supply of loanable funds. D) reduce real GDP.
B
You might also like to view...
Suppose the price of a DVD is $15 per unit. At that price, consumers wish to purchase 6,000 units weekly and producers wish to sell 4,000 units weekly. In this situation,
a. unsatisfied consumers will bid up the market price. b. the market price will fall because producers are unsatisfied. c. the price will rise and the demand will fall to bring the market to equilibrium. d. supply will increase by 2,000 units in order to satisfy consumers.
In the following question you are asked to determine, other things equal, the effects of a given change in a determinant of demand or supply for product X upon (1) the demand (D) for, or supply (S) of, X; (2) the equilibrium price (P) of X; and (3) the equilibrium quantity (Q) of X. An increase in the price of a product that is a complement to X will:
A. decrease S, decrease P, and decrease Q. B. increase D, increase P, and increase Q. C. decrease D, decrease P, and decrease Q. D. increase D, increase P, and decrease Q.