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. It measures the change in aggregate demand resulting from a change in government spending, assuming no change in other variables.

The Partial Expenditure Multiplier