When we relax the assumption that net exports do not change with income, the aggregate expenditure function
A) becomes steeper because net exports decrease as real domestic income increases
B) becomes steeper because net exports increase as real domestic income increases
C) becomes flatter because net exports decrease as real domestic income increases
D) becomes flatter because net exports increase as real domestic income increases
E) remains unchanged because it is not affected by changes in net exports
Correct Answer:
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Q1: With a proportional income tax,
A)the tax multiplier
Q2: In which of the following situations will
Q4: If the MPC is equal to .75
Q5: With a proportional income tax,
A)each individual pays
Q6: In a model with a proportional income
Q7: The balanced budget multiplier
A)increases as MPC increases
B)increases
Q8: If the government increased autonomous net taxes
Q9: If the government wants to increase equilibrium
Q10: If the MPC equals 0.75 and the
Q11: If the MPC = 0.8 and both
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