Which of the following measures the change of real GDP in the short run as a result of an increase in government purchases?
A)Spending balance
B)Potential GDP
C)Life-cycle model
D)Keynesian multiplier
E)45-degree line

Question

Quizplus · Accepted Answer

The Keynesian multiplier measures how much real GDP will change in the short run in response to a change in government purchases. It is calculated by dividing the change in real GDP by the initial change in government purchases.

Which of the Following Measures the Change of Real GDP