1) Which of the following is included in G? a. Medicaid b. Pensions c. Medicare d. Social Security e. Government purchases 2) Suppose the consumption equation is represented by the following: C = 250 + 0.75YD. Now assume government spending increases by 100 for the above economy. Given the above information, we know that equilibrium output will increase by a. 1000 b. 1250 c. 200 d. 800 e. 400 3) Which of the following will not increase equilibrium output in the short run? a. Increases in investment demand b. Increases in consumer confidence c. Increases in R&D d. Decreases in taxes e. Increases in government spending
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