This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: The largest component of GDP in the US is typically: a. government purchases. b. social ... (Read 72 times)

pragya sharda

  • Hero Member
  • *****
  • Posts: 566
on: Jun 30, 2018
The largest component of GDP in the US is typically:
 
  a. government purchases.
  b. social securtity.
  c. consumption.
  d. investment.
  e. net exports.

Question 2

Briefly explain why changes in government spending or taxes do not have independent effects on aggregate demand. What does shift the aggregate demand curve in the classical model?
 
  What will be an ideal response?


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

debra928

  • Sr. Member
  • ****
  • Posts: 342
Reply #1 on: Jun 30, 2018
Answer to Question 1

C

Answer to Question 2

Government spending and taxes do not have independent effects on aggregate demand because of the adjustment of the interest rate and resulting crowding-out effects on the components of private sector demand. The only things that shift aggregate demand are changes in the money supply or the velocity of money.


pragya sharda

  • Member
  • Posts: 566
Reply 2 on: Jun 30, 2018
Gracias!

FergA

  • Member
  • Posts: 352
Reply 3 on: Yesterday
Great answer, keep it coming :)

« previous next »
 

Did you know?

HIV testing reach is still limited. An estimated 40% of people with HIV (more than 14 million) remain undiagnosed and do not know their infection status.

Did you know?

There are major differences in the metabolism of morphine and the illegal drug heroin. Morphine mostly produces its CNS effects through m-receptors, and at k- and d-receptors. Heroin has a slight affinity for opiate receptors. Most of its actions are due to metabolism to active metabolites (6-acetylmorphine, morphine, and morphine-6-glucuronide).

Did you know?

The B-complex vitamins and vitamin C are not stored in the body and must be replaced each day.

Did you know?

Cyanide works by making the human body unable to use oxygen.

Did you know?

Walt Disney helped combat malaria by making an animated film in 1943 called The Winged Scourge. This short film starred the seven dwarfs and taught children that mosquitos transmit malaria, which is a very bad disease. It advocated the killing of mosquitos to stop the disease.

Goliath birdeater (Theraphosa blondi), the largest spider, next to a ruler. Goliath birdeater (Theraphosa blondi), the largest spider, next to a ruler.
Largest Moth Largest Moth
In 2008, the U.S. economy suffered a gaping wound as several trillion dollars were ripped out of it. In 2008, the U.S. economy suffered a gaping wound as several trillion dollars were ripped out of it.
Jerry Uelsmann, Untitled (rock component). Jerry Uelsmann, Untitled (rock component).
Vienna: Social Structure and Social Interaction Vienna: Social Structure and Social Interaction
When a Tornado Strikes: Social Organization Following a Natural Disaster When a Tornado Strikes: Social Organization Following a Natural Disaster
Video: Pressure volume relationships - Normal inspiration and expiration

For a complete list of videos, visit our video library