Homework Clinic
Social Science Clinic => Economics => Topic started by: nautica902 on Jun 30, 2018
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When private expenditures decrease as a result of increased government spending, this is known as
A) the multiplier effect. B) the stabilizer effect.
C) government deficit spending. D) the crowding out effect.
Question 2
Samia makes 8,000 a month. Samia spends 2,500 on rent and related household expenses, 500 on food, 200 on clothes, 500 on entertainment and 600 on transportation. She always keeps 200 for things like the car breaking down.
3,500 is invested in the stock market. Which of the following statements is TRUE?
A) The transactions demand for money is 4,300, the precautionary demand is 200 and the asset demand is 0.
B) The transactions demand for money is 4,300, the precautionary demand is 200 and the asset demand is 3,500.
C) The transactions demand for money is 3,500, the precautionary demand is 200 and the asset demand is 4,300.
D) The transactions demand for money is 4,300, the precautionary demand is 3,500 and the asset demand is 200.
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Answer to Question 1
D
Answer to Question 2
A