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22.3 Goods Market Equilibrium
If unplanned investment is positive, firms will ____ production and output will
____.
A) cut; rise
B) cut; fall
C) increase; rise
D) increase; fall
Answer: B
Diff: 2 Type: MC Page Ref: 546 - 547
Skill: Applied
Objective List: 22.1 Utilize the Keynesian cross model for the determination of aggregate output
If unplanned investment is negative, firms will ____ production and output will
____.
A) cut; rise
B) cut; fall
C) increase; rise
D) increase; fall
Answer: C
Diff: 2 Type: MC Page Ref: 546 - 547
Skill: Applied
Objective List: 22.1 Utilize the Keynesian cross model for the determination of aggregate output
In the Keynesian framework, as long as output is below the equilibrium level, unplanned
inventory investment will remain ____ and firms will continue to ____ production.
A) negative; lower
B) negative; raise
C) positive; lower
D) positive; raise
Answer: B
Diff: 2 Type: MC Page Ref: 546 - 547
Skill: Applied
Objective List: 22.1 Utilize the Keynesian cross model for the determination of aggregate output
In the Keynesian framework, as long as output is ____ the equilibrium level, unplanned
inventory investment will remain ____ and firms will continue to raise production.
A) below; negative
B) above; negative
C) below; positive
D) above; positive
Answer: A
Diff: 2 Type: MC Page Ref: 546 - 547
Skill: Applied
Objective List: 22.1 Utilize the Keynesian cross model for the determination of aggregate output