Because of changes in the ________, the long-run effect of a $10 increase in investment on real GDP equals ________.
A)money wage rate and price level; $10
B)interest rate; zero
C)money wage rate and price level; zero
D)interest rate; $10

Question

Quizplus · Accepted Answer

In the long run, changes in the money wage rate and price level adjust to bring the economy back to full employment, so the effect of a $10 increase in investment on real GDP is zero.

Because of Changes in the ________, the Long-Run Effect of a $10