The multiplier effect refers to:
A) the total amount by which GDP falls after an initial injection
B) the change in GDP brought about by multiple policy changes
C) the amount of the initial increase in aggregate demand brought about by a new injection into the economy
D) the total amount by which GDP rises after an initial injection
Correct Answer:
Verified
Q19: An output gap where equilibrium GDP is
Q20: A woman who retired becomes bored with
Q21: The largest component of aggregate demand in
Q22: The increase in unemployment that occurs during
Q23: The net export component of aggregate demand
Q25: If the MPW increases, the multiplier will:
A)
Q26: The portion of unemployment that is due
Q27: If the multiplier is 4, a $10
Q28: Consumption smoothing is the idea that:
A) you
Q29: The formula for the multiplier is:
A) 1/MPC
B)
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