1. D. -2.

5
2. C. the value of all cars produced by General… ( k chắc)
3. C reduce government purchased by…
4. A ratio of real GDP to nominal GDP multiplied by 100
5. B decrease consumer spending and increase …
6. C the average price level declines
7. D increase taxes and/ or decrease government spending
8. C a good medium of exchange and a good store of value
9. D a recession
10. A in current dollars
11. A $66.7 million
12. B -1,000 tools
13. D household, the government, business firms and the rest of the world
14. B $3.700
15. C AE line shifts down, decreasing equilibrium output…
16. A $75 million unplanned decrease in inventories
17. A is $140
18. B the value of all final goods and services
19. B increasing output
20. C 2,000; 500
21. C that total spending on final goods and services in the US…
22. B not counting the value of intermediate goods in GDP
23. A the behavior of each individual
24. D economic activity declines
25. A decrease consumer spending and increase consumer saving
26. D demand; demand
27. A goods and services; labor
28. B the 2022 salary of a used motorcycled salesperson
29. C all of the above
30. A a new tire you buy for your personal car
31. A multiplier
32. D GNP; GDP
33. D 0.50
34. A AE= 150+0.25Y
35. A increase current spending
36. A GDP= C+I+G+EX-IM
37. C a cash payment made by the government to people…
 38. A all final goods and services produced by resources owned…
39.

C = 150 + 0.75(Y-T) G = 150 T = 200 I = 100 At equilibrium Y = C + I + G Y = 150 +

0.75(Y-200) + 100 + 150 0.25Y = 250 Y = 250/0.25 = 1,000 C = 150 + 0.75(1000 - 200)
= 750 S = I = 100 Now, taxes decrease by 20 Tax Multiplier = -MPC/1-MPC = -0.75/1-
0.75 = -0.75/0.25 = -3 Change in Y = Taxmultiplier*Change in Tax = -3*-20 = 60 So,
New Y = 1000 + 60 = sdása New C = 150 + 0.75(1060-180) = 810 NEW S = I = 100 The
arguments in favour of tax cut are that they increase the output in the econmy and hence
increases the consumption and savings by the households, and thus increases the labour
supply and output in the economy. The arguments against the tax cut is that it increases
the government deficit and hence increases the interest rate and prices in the economy.