The sum of planned consumption expenditure, planned investment, planned government purchases, and planned net exports is ________________.

real GDP
aggregate planned expenditure
the expenditure approach to real GDP
aggregate expenditure

The consumption function is the relationship between consumption expenditure and ___________________, other things remaining the same.

disposable income
saving
potential GDP
the 45 degree line

The marginal propensity to consume ____________________.

plus the marginal propensity to save equals 1
is the fraction of GDP consumed
is the amount of disposable income consumed
is the fraction of disposable income consumed

The marginal propensity to save is _____________.

equal to the slope of the saving function
always greater than the marginal propensity to consume
equal to 1 plus the slope of the consumption function
equal to the inverse of the marginal propensity to consume

The marginal propensity to import is _______ that is spent on imports.

the fraction of an increase in real GDP
the fraction of an increase in potential GDP
the amount of real GDP
the amount of potential GDP

The part of aggregate planned expenditure that does not vary with real GDP _______________.

is autonomous expenditure
equals equilibrium expenditure
equals zero
is induced expenditure

Induced expenditure includes ______________________.

induced consumption expenditure minus imports
autonomous expenditure
induced consumption expenditure plus imports
induced consumption and government purchases

All of the following statements about equilibrium expenditure are true except:

Actual investment is less than planned investment.
Aggregate planned expenditure equals real GDP.
Aggregate planned expenditure equals actual expenditure.
Unplanned inventory investment is zero.

The multiplier is the amount by which ____________________ is multiplied to determine __________________.

the change in autonomous expenditure; the change in real GDP
the change in induced expenditure; the change in potential GDP
autonomous expenditure; real GDP
induced expenditure; real GDP

The multiplier is greater than 1 because the change in autonomous expenditure leads to ______________.

less consumption expenditure
more induced expenditure
more investment
more saving

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