Question

1. If the multiplier is 6 and exports decrease by $30, what impact will that have on aggregate expenditure?           

A) decrease by $180        B) increase by $180

C) increase by $30            D) decrease by $30

2, An increase of the tax on business income will reduce aggregate demand because          

A) consumption spending will fall              B) government spending will fall

C) investment spending will fall                 D) wages will increase

3.

Saving equals

A) disposable income minus consumption expenditure.

B) consumption expenditure minus disposable income.

C) disposable income plus consumption expenditure.

D) disposable income minus taxes

Answer 1