A decrease in the income tax rate would imply the following:
A. a decrease in saving
B. a decrease in government spending
C. a decrease in government transfer payments
D. an increase in the expenditure multiplier
E. all of the above
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The expenditure multiplier is used to calculate the change in
A. spending caused by a change in income
B. equilibrium income caused by a change in autonomous spending
C. intended spending caused by a change in consumption
D. disposable income caused by a change in saving
E. government expenditures caused by a change in income
In a simple model with no government or foreign sector, the change in unplanned inventory at equilibrium is
A. dependent upon the amount of consumption
B. equal to output minus consumption
C. zero
D. always positive
E. usually negative
If there is no government or foreign sector and planned investment equals planned saving, then
A. actual output is equal to planned spending on consumption and investment
B. consumption plus investment equals income
C. the quantity of output produced is equal to aggregate demand
D. there are no unplanned inventory changes
E. all of the above
Assume a model with no government or foreign sector. If actual output is $13.1 trillion while aggregate demand is $13.2 trillion, we know that
A. the magnitude of unintended inventory adjustments is - $100 billion
B. the magnitude of unintended inventory adjustments is + $100 billion
C. the magnitude of unintended inventory adjustments is + $10 billion
D. the actual income level is above its equilibrium
E. there currently is an excess supply of goods and services
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