The multiplier is useful in determining the
A)full-employment unemployment rate.
B)level of business inventories.
C)change in the rate of inflation from a change in the interest rate.
D)change in GDP resulting from a change in spending.

Question

Quizplus · Accepted Answer

The multiplier effect explains how an initial change in spending leads to a larger change in GDP, making it useful for determining the change in GDP from a change in spending.

The Multiplier Is Useful in Determining the