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7. Given the expected rate of return on all possible investment opportunities in the economy, a(n) B. decrease in the real rate of interest will tend to increase the level of investment. C. decrea A. increase in the real rate of interest will tend to increase the level of investment. se in the real rate of interest will tend to decrease the level of investment. D. change in the real interest rate will have no impact on the level S. AI SI increase in government spending on goods and services will have a greater impact on the equilibrium GDP than will a $1 decline in taxes because A. government spending is more employment intensive than is either consumption or investment spending B. government spending increases the money supply and a tax reduction does not C. a portion of a tax cut will be saved. D. taxes vary directly with income. 9. An increase in technology A. increases; increases potential GDP and aggregate supply -。 reases D. decreases; increases 10. An appropriate fiscal policy for a severe recession is A. a decrease in government spending B. a decrease in tax rates C. appreciation of the dollar D. an increase in interest rates

Answer 1

7) Ans:

B).Decrease in the rate of interest will tend to increase the level of investment

The Rate of Interest in the economy decreases then the Investment will get increase by taking the opportunity of Low interest rate and Invest these funds in the economy industry their by maximize the Profits

8) Ans:

C).a Portion of a Tax cut will be saved

9) Ans:

A) Increases: Increases

An Increase in technology will leads to mass industry production in span of least time as results it increase GDP and Availability of supply of goods on time.

10) Ans:

A) Decrease in Tax Rates

Severe recession means have no money among the economy which leads to reduction in tax rates