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Consider the following information describing a closed economy with no government and where aggregate output is demand determined. All dollar figures are in billions. 1. The marginal propensity to consume is 0.90 2. The autonomous part of C is $300 3. Investment is autonomous and is $100 At the equilibrium level of national income, desired consumption expenditure (in billions) is... O a. $3 900. O b. $400. O c. $4 000. O d. $3 600. O e. $300.The concept of "demand-determined output" requires to remain constant as output increases. O a. Labour productivity. O b. The ratio of price setters to price takers. O c. Government purchases. O d. Technology of production. O e. Firms' unit costs.Consider the simple macro model with a constant price level and demand- determined output. The inclusion of government in such a model affects desired aggregate expenditure directly through the and indirectly through a. The government purchases of goods and services; its effect on investment. b. The net taxes; its effect on disposable income. c. The net taxes; the government purchases of goods and services. d. The government purchases of goods and services; its effect on net exports. e. The government purchases of goods and services; its effect on disposable income. The real interest rate must be... a. Negative if the nominal rate of interest is greater than the rate of inflation. b. High if the inflation rate is greater than the nominal interest rate. 0. Low if the nominal interest rate is high. d. High if the nominal interest rate is high. e. Positive if the nominal rate of interest is greater than the rate of inflation. causes a downward parallel shift in the AE curve and a movement upward along the AD curve. T? a. A reduction in government purchases. (7' b. A decrease in the MPG. '73" c. An increase in the price level. '7' d. A decrease in the price level. e. A decrease in the business confidence of rms