True or false

1, The increase in GDP divided by the increase in desired savings is known as the investment multiplier.

2, The new portion of personal disposable income that is earmarked for consumption is known as PMgC

3, The savings diagram expresses the relationship between personal disposable income and savings.

4, The increase in GDP divided by the increase in desired investment is known as the investment multiplier.

5, An increase in investment leads to an increase in gross domestic product. Equilibrium occurs when the forces of expansion and contraction are in equilibrium, i.e., when savings are greater than the desired investment.

6, A fixed (constant) tax results in a downward shift of the savings function by an amount equal to the product of the tax multiplied by the PMgA

7, The break-even point represents the level at which aggregate expenditures equal gross domestic product.

8, The term aggregate expenditure indicates how the aggregate quantity of goods and services demanded depends on the average price level.

9, The higher the PMgC, the higher the multiplier

10, The higher the PMgA, the greater the multiplier

11, In recession years, gross investment generally increases.

12, Changes in the investment diagrams change the level of output-income by several times the initial change in expenditure.

13, The return on equity is the real interest rate, which is equal to the nominal interest rate adjusted for inflation.

14, The investment decisions of companies are influenced only by the general price level of the economy.

15, The expected rate of return and the real interest rate influence the investment decisions of companies.

16, Wealth increases when the market value of assets increases, and is called capital gains, and decreases when the market value of assets falls, and is known as capital losses.

17, Net investment is the change in the amount of new capital.

18, The funds that companies use to purchase physical capital are called financial capital.

19, The daily use of the term investment, understood as the purchase of stocks or bonds, can generate confusion with the term capital invention.

20, Wealth increases when the amount of cash increases, and we call it capital gains, and decreases when the amount of cash falls, and we call it capital losses.

21, Economic inflation is alleviated through lower taxes.

22, A flat $2,500,000 reduction in income taxes will increase disposable income by exactly $2,500,000.

23, An economic recession is relieved through higher taxes.

24, Fiscal policy has important effects on the level of employment, nominal GDP and aggregate supply, known as supply side effects.

25, If government revenues exceed outlays, the government has a budget deficit. If outlays exceed revenues, the government has a budget surplus. If revenues equal outlays, the government has a balanced budget.