The aggregate expenditure line is upward sloping since as GDP increases
A) consumption increases.
B) investment increases.
C) government purchases increase.
D) net exports increase.
The marginal propensity to consume can best be described as
A) consumption / income.
B) the impact of a change in income on GDP.
C) the change in income divided by the change in consumption.
D) the change in consumption divided by the change in income.
The capacity of a firm can best be described as
A) when a firm is producing maximum output.
B) a firm's production when operating normal hours using a normal sized workforce.
C) when a firm makes full use of all the space available in its factory or building.
D) when all of the firm's workers are producing at their maximum potential.
An autonomous expenditure is one that does NOT depend on
A) government policy.
B) the automobile sector.
C) interest rates.