In the income-expenditure model, if autonomous saving increases ...

[kfurse]

In the income-expenditure model, if autonomous saving increases by 15 billion, _____.
 a. the aggregate expenditure line shifts upward by 15 billion
 b. planned investment increases by 15 billion
 c. the aggregate expenditure line shifts downward by 15 billion
 d. planned investment decreases by 15 billion
 e. the equilibrium level of real GDP demanded decreases by 15 billion

Question 2

A pollution tax that is exactly equal to marginal external cost will shift the market supply curve to the social-cost supply curve. This tax will thus correct the market inefficiency due to negative externalities by causing price to reflect the full marginal cost of production.
 a. True
  b. False
  Indicate whether the statement is true or false

[rnehls]

Answer to Question 1

c

Answer to Question 2

True

[kfurse]

Thank you

[rnehls]

No problemo