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Assume That the Economy's Marginal Propensity to Expend Is 0

Question 63

Multiple Choice

Assume that the economy's marginal propensity to expend is 0.6, the initial baseline level of autonomous spending is $4000 billion, a one percentage point increase in the real interest rate will reduce the sum of investment and gross exports by $100 billion the inflation rate is 2%, and the LM curve is Y=$1500 + $1000 x (r + Assume that the economy's marginal propensity to expend is 0.6, the initial baseline level of autonomous spending is $4000 billion, a one percentage point increase in the real interest rate will reduce the sum of investment and gross exports by $100 billion the inflation rate is 2%, and the LM curve is Y=$1500 + $1000 x (r +     )  -Suppose that the central bank increases the nominal money supply so that the new LM curve is Y=$3000 + $1000 x (r +   ) . The new equilibrium level of national income would be A)  $9150 billion. B)  $9575 billion. C)  $9000 billion. D)  $8600 billion. )
-Suppose that the central bank increases the nominal money supply so that the new LM curve is Y=$3000 + $1000 x (r + Assume that the economy's marginal propensity to expend is 0.6, the initial baseline level of autonomous spending is $4000 billion, a one percentage point increase in the real interest rate will reduce the sum of investment and gross exports by $100 billion the inflation rate is 2%, and the LM curve is Y=$1500 + $1000 x (r +     )  -Suppose that the central bank increases the nominal money supply so that the new LM curve is Y=$3000 + $1000 x (r +   ) . The new equilibrium level of national income would be A)  $9150 billion. B)  $9575 billion. C)  $9000 billion. D)  $8600 billion. ) . The new equilibrium level of national income would be


A) $9150 billion.
B) $9575 billion.
C) $9000 billion.
D) $8600 billion.

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