Multiple Choice
Which of the following statements is true?
A) In an open economy, the smaller a nation's marginal propensity to import, the smaller the multiplier.
B) In an open economy, the larger a nation's marginal propensity to consume, the smaller the multiplier.
C) In an open economy, the larger a nation's marginal propensity to export, the smaller the multiplier.
D) In an open economy, the larger a nation's marginal propensity to import, the smaller the multiplier.
Correct Answer:
Verified
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