1. An increase in the level of taxes will shift the ____ curve to the _____.
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2. Suppose households decide to increase their level of consumption for any given income level, leading to an increase in the marginal propensity to consume. This will cause a shift of the ____ curve and as a result the equilibrium interest rate will _____.
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3. A decline in government spending will cause the equilibrium interest rate to _____ and the level of investment to _____.
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4. The saving curve is a vertical line because of the assumption that
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B. |
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D. |