Adam Smith believed that the pursuit of the public interest is also the best way to promote the private self interest.
a. True
b. False
Indicate whether the statement is true or false
Question 2
Use the aggregate expenditures model and assume an economy is in equilibrium at 5 trillion which is 250 billion below full-employment GDP. If the marginal propensity to consume (MPC) is 0.60, full-employment GDP can be reached if government spending:
a. increases by 60 billion.
b. increases by 100 billion.
c. increases by 250 billion.
d. is held constant.
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