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Assume a model with no government or foreign sector. If the actual output is $13.1 trillion while aggregate demand is $13.2 trillion, we know that
Assume a model with no government or foreign sector. If the actual output is $13.1 trillion while aggregate demand is $13.2 trillion, we know that O the magnitude of unintended inventory adjustments is - $100 billion O the magnitude of unintended inventory adjustments is + $100 billion O the magnitude of unintended inventory adjustments is + $10 billion the actual income level is above its equilibriumIn a Keynesian model of income determination, when intended spending is greater than actual output, the adjustment to a new macro-economic equilibrium is based on a(n)___ in decrease; government spending O increase; government spending O increase; unplanned inventories decrease; unplanned inventoriesIf the marginal product of capital is above the rental cost of capital, then a firm should and a firm is expected to observe the highest level of desired capital stock if O increase investment spending to increase the capital stock; the rental cost of capital is low and the level of output is high O decrease investment spending since any new investment projects will be unprofitable; the rental cost of capital is high and the level of output is low O leave investment spending at the current level since any additions to the existing capital stock will not be profitable; the rental cost of capital is low and the level of output is low O undertake only replacement investments since any additions to the capital stock will not be profitable; the rental cost of capital is high and the level of output is highAn expansionary fiscal policy stimulates output more in the IS-LM model than in the Keynesian model of income determination as price level is fixed in the Keynesian model. O less in the IS-LM model than in the Keynesian model of income determination as the interest rate is held constant and there is no crowding-out effect in the Keynesian model. O by the same amount in IS-LM and in the Keynesian model of income determination as the interest rate is held constant and there is no crowding-out effect in the Keynesian model. O less in the IS-LM model than in the Keynesian model of income determination as the price level is fixed in the IS-LM model
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