Which of the following will cause consumption to increase and ...

[Deast7027]

Which of the following will cause consumption to increase and aggregate demand to shift to the left?
 a. an optimistic business forecast of future income growth
  b. increased consumer wealth
 c. an increase in consumer confidence
 d. none of the above

Question 2

Imagine an economy that does not have international trade and is initially in equilibrium. Later the government increases the level of spending by 350 million because it received a gift from abroad. In this economy, only 65 cents of every dollar is spent, and the rest is saved. Calculate the value of the spending multiplier for this economy.
 a. 2.86
  b. 0.286
  c. 1.54
  d. 0.154
  e. 0.35

[jsm54321]

Answer to Question 1

d

Answer to Question 2

a

[Deast7027]

Thank you

[jsm54321]

No problemo