Author Question: When the multiplier is ________, an autonomous decrease in investment of 200 billion decreases ... (Read 168 times)

mspears3 · **on:** Jun 29, 2018

When the multiplier is ________, an autonomous decrease in investment of 200 billion decreases equilibrium real GDP by 400 billion.

When the multiplier is ________, an autonomous decrease in investment of 200 billion decreases equilibrium real GDP by 800 billion.
A) 2.0; 4.0
B) 0.4; 0.2
C) 0.2; 0.4
D) 4.0; 8.0
E) 400 billion; 800 billion

Question 2

The demand for money curve is shown in the figure above. A movement from point B to point C could be the result of

A) a rise in the real interest rate.
B) an increase in the quantity of money held by banks.
C) a fall in the nominal interest rate.
D) a rise in the real interest rate matched by an equal fall in the nominal interest rate.
E) a decrease in the total benefit from holding money.