Solved

Consider a Simple Economy That Is Made Up of Three

Question 89

Multiple Choice

Consider a simple economy that is made up of three sectors: households, firms, and government. Let Y = real GDP, AE = Aggregate Expenditures, C = Consumption, JIP = Planned Investment, G = Government Purchases. Further, IP and G are autonomous.
JIn this case, the slope of the aggregate expenditures curve is


A) 1.
B) infinity (since the AE curve is horizontal) .
C) equal to the marginal propensity to consume.
D) the value of the multiplier.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Q84: Difficulty: Medium Figure 13-4 Difficulty:</p></div><svg width=

Q85: Figure 13-5 Figure 13-5 </p></div><svg width=

Q86: Figure 13-5 Figure 13-5 </p></div><svg width=

Q87: Figure 13-5 Figure 13-5 </p></div><svg width=

Q88: Difficulty: Medium Figure 13-4 Difficulty:</p></div><svg width=

Q90: Figure 13-5 Figure 13-5 </p></div><svg width=

Q91: Difficulty: Medium Figure 13-4 Difficulty:</p></div><svg width=

Q92: Difficulty: Medium Figure 13-4 Difficulty:</p></div><svg width=

Q93: Difficulty: Medium Figure 13-4 Difficulty:</p></div><svg width=

Q94: Difficulty: Medium Figure 13-4 Difficulty:</p></div><svg width=

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents