Question

An increase in savings by consumers is seen as a(n) decrease in investment spending in the economy increase in government spending in the economy. decrease in exports in the economy. increase in imports in the economy. leakage in spending in the economy.

Question 2(Multiple Choice Worth 1 points) If changes in the stock market cause an increase in consumer wealth, we would expect to see a/an increase in consumer indebtedness. increase in consumer card balances. increase in consumer spending. decrease in investment spending. decrease in imports.

Question 3(Multiple Choice Worth 1 points) A college graduate who is searching for his first job illustrates the concept of cyclical unemployment. frictional unemployment. structural unemployment. an employed individual. a discouraged worker.

Answer 1

Answer:1 The answer is leakage in spending in the economy, 2 The answer is increase in consumer spending 3 Frictional unemployment

Explanation:

Savings : This is the keeping of certain amount of money with a view to utilize it for the purpose of investment in the future, it is a part of income of the people which are not consumed immediately which reduces households and producers expenditure. Savings arise when there are enough incomes for immediate consumption such that some are reserved for future purposes.

Increase in consumer wealth: This is when there is an increase in the purchasing power of the people as a result of an increase in their financial situation. When this occur, their will be too much money in their hands,which will increase their purchasing power and thus increase their ability to buy more goods and services in the economy.

Frictional unemployment : This is a type of unemployment which arises when people leave their present job with the hope of getting a new and better one but fail to do so.It may or may not be a temporary unemployment depending on the prevailing economic situation in the country. Example of frictional unemployment is a college graduate who is searching for his first job.

Answer 2

Answer:

1. Leakage in the economy

2. Increase in consumer spending

3. Frictional unemployment