In the Keynesian model, a $1 billion increase in autonomous consumption leads to ________ in short-run equilibrium output.
A)a $1 billion increase
B)a greater than $1 billion increase
C)no change
D)a $1 billion decrease

Question

Quizplus · Accepted Answer

Due to the income-expenditure multiplier, a $1 billion increase in autonomous consumption results in a final increase in output greater than $1 billion.

In the Keynesian Model, a $1 Billion Increase in Autonomous