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Investment Decreases by $300 Billion, Government Expenditure Is Unchanged, and Exports

Question 250

Multiple Choice

Investment decreases by $300 billion, government expenditure is unchanged, and exports increase by $500 billion. As a result, autonomous expenditure ________, the total expenditure ________, and equilibrium real GDP ________.


A) decreases by $300 billion; decreases; decreases by more than $300 billion
B) increases by $500 billion; is unchanged; increases by more than $500 billion
C) is unchanged; is unchanged; is unchanged
D) increases by $800 billion; increases; increases by more than $800 billion
E) increases by $200 billion; increases; increases by more than $200 billion

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