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Spending (bilions of dollars) 800 45-degree line 700 AE 600 500 400 300 200 100 100 200 300 400 500 600 700 800 Inceme or Real GDP (billions of dollars) 3) In the above figure, the movement from AE1 to AE2 is caused by: a. a $200 billion increase in investment expenditure. b. a $100 billion increase in taxes. c. a $100 billion increase in government purchases. d. a $300 billion increase in real GDP. e. a $100 billion increase in income. 4) Based on the information presented in the above figure, if investmen expenditure declines by $50 billion, then real income will a. increase by $150 bilion. b. increase by $125 billion. c. decrease by $125 billion. d. decrease by $150 billion. e. decrease by $50 billion,

Spending (bilions of dollars) 800 45-degree line 700 AE 600 500 400 300 200 100 100 200 300 400 500 600 700 800 Inceme or Real GDP (billions of dollars) 3) In the above figure, the movement from AE1 to AE2 is caused by: a. a $200 billion increase in investment expenditure. b. a $100 billion increase in taxes. c. a $100 billion increase in government purchases. d. a $300 billion increase in real GDP. e. a $100 billion increase in income. 4) Based on the information presented in the above figure, if investmen expenditure declines by $50 billion, then real income will a. increase by $150 bilion. b. increase by $125 billion. c. decrease by $125 billion. d. decrease by $150 billion. e. decrease by $50 billion,

Principles of Economics 2e
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter19: The Macroeconomic Perspective
Section: Chapter Questions
Problem 1SCQ: Country A has export sales of 20 billion, government purchases of 1,000 billion, business investment...
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Spending (billions of dollars) 800 45-degree line AE 700 AE 600 00 400 300 200 100 100 200 300 400 500 600 700 Income or Real GDP (billions of dollars) 800 3) In the above figure, the movement from AE1 to AE2 is caused by: a. a $200 billion increase in investment expenditure. b. a $100 billion increase in taxes. c. a $100 billion increase in government purchases. d. a $300 billion increase in real GDP. e. a $100 billion increase in income. 4) Based on the information presented in the above figure, if investment expenditure declines by $50 billion, then real income will a. increase by $150 billion. b. increase by $125 billion. c. decrease by $125 billion. d. decrease by $150 billion. e. decrease by $50 billion.
Transcribed Image Text:Spending (billions of dollars) 800 45-degree line AE 700 AE 600 00 400 300 200 100 100 200 300 400 500 600 700 Income or Real GDP (billions of dollars) 800 3) In the above figure, the movement from AE1 to AE2 is caused by: a. a $200 billion increase in investment expenditure. b. a $100 billion increase in taxes. c. a $100 billion increase in government purchases. d. a $300 billion increase in real GDP. e. a $100 billion increase in income. 4) Based on the information presented in the above figure, if investment expenditure declines by $50 billion, then real income will a. increase by $150 billion. b. increase by $125 billion. c. decrease by $125 billion. d. decrease by $150 billion. e. decrease by $50 billion.
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