Suppose the government increases its purchases by Rs16 billion. If the multiplier effect exceeds the crowding out effect, then ?

Related Mcqs:

If the marginal propensity of consume MPC is 0.75 the value of the multiplier is ?

A. 4 B. 7.5 C. 5 D. 0.75...

Suppose a wave of investor and consumer optimisms has increased spending so that the current level of input exceeds the long-run natural rate If policy makers choose to engage in activist stabilization policy they should ?

A. decrease government spending Which the shifts the aggregate demand curve to the left B. decrease taxes, which shifts the aggregate demand curve to the right C. decrease taxes, which shifts the aggregate demand curve to the left D. decrease government spending which shifts the aggregate demand curve to the right...

Which of the following statements regarding taxes is correct ?

A. Most economists believe that in the short run the greatest impact of a change in taxes is on aggregate supply, not aggregate demand B. An increase in taxes shifts the aggregate demand curve to the right C. A decrease in taxes shifts the aggregate supply curve to the left D. A permanent change in … Which of the following statements regarding taxes is correct ?Read More...

When an increase in government purchases increases the income of some people, and those people spend some of that increase in income on additional consumer goods, we have seen a demonstration of ?

A. The multiplier effects B. supply side economics C. None of these answers D. The crowding out effect...

When money demand is expressed in a graph with the interest rate on the vertical axis and the quantity of money on the horizontal axis an increase in the interest rate ?

A. None of these answers B. decrease the quantity demanded of money C. increase the quantity demanded of money D. decreases the demand for money E. increases the demand for money...