The partial expenditure multiplier
A) is the total increase in the demand for goods.
B) is the total increase in government spending.
C) equals (1 - MPC).
D) is the ratio of total increase in demand for goods to the increase in government spending.
E) equals the MPC.

Question

Quizplus · Accepted Answer

The partial expenditure multiplier is the ratio of the total increase in demand for goods to the increase in government spending. This means that for every additional unit of government spending, the total demand for goods will increase by a certain multiple, which is the partial expenditure multiplier.

The Partial Expenditure Multiplier