Question : 111) Consider a simple macro model with a constant price : 1384375

 

111) Consider a simple macro model with a constant price level and demand-determined output. Using this model, if economists want to estimate the effect of a given change in desired investment on equilibrium national income, they would multiply the change in desired investment by the

A) average propensity to save.

B) marginal propensity to save.

C) equilibrium level of national income.

D) simple multiplier.

E) reciprocal of the marginal propensity to spend.

112) The simple multiplier applies to short-run situations in which the price level is constant. The simple multiplier can be defined as

A) national income divided by aggregate expenditure.

B) the change in equilibrium national income divided by the initial change in autonomous expenditure that brought it about.

C) the change in national income resulting from a change in expenditure, multiplied by the number of years since the initial change.

D) a change in aggregate expenditures multiplied by the equilibrium level of national income.

E) the change in national income resulting from a change in saving.

113) In a simple macro model with demand-determined output, the simple multiplier is equal to 1/(1-z), where z equals the

A) average propensity to spend.

B) average propensity not to spend.

C) level of autonomous expenditure.

D) marginal propensity to spend.

E) marginal propensity not to spend.

114) Consider a simple macro model with a constant price level and demand-determined output. If the marginal propensity to spend in such a model is zero, the simple multiplier is

A) zero.

B) a positive number between zero and one.

C) one.

D) a positive number greater than one but less than infinity.

E) infinitely large.

115) Consider a simple macro model with a constant price level and demand-determined output. If the marginal propensity to spend in such a model is one, the simple multiplier is

A) zero.

B) a positive number between zero and one.

C) one.

D) a positive number greater than one but less than infinity.

E) infinitely large.

116) Consider a simple macro model with a constant price level and demand-determined output. If the marginal propensity to spend in such a model is between zero and one, the simple multiplier is

A) zero.

B) a positive number between zero and one.

C) one.

D) a positive number greater than one but less than infinity.

E) infinitely large.

117) Consider a simple macro model with a constant price level and demand-determined output. If the marginal propensity to spend in such a model is 0.6, the simple multiplier is

A) 0.

B) 0.6.

C) 1.67.

D) 2.5.

E) 6.0

118) Consider a simple macro model with a constant price level and demand-determined output. If the marginal propensity to spend in such a model is 0.4, the simple multiplier is

A) 0.

B) 0.4.

C) 1.67.

D) 2.5.

E) 4.0.

119) Consider a simple macro model with a constant price level and demand-determined output. If the marginal propensity to spend in such a model is 0.8, the simple multiplier is

A) 0.

B) 0.8.

C) 1.25.

D) 5.0.

E) 8.0.

120) Consider a simple macro model with demand-determined output. If z is the marginal propensity to spend out of national income, Y is national income and A is autonomous expenditure, then the simple multiplier is equal to

A) z.

B) 1 – z.

C) 1/z.

D) 1/(1-z).

E) Y/(1-z).

 

 

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