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Under What Circumstances Will the Multiplier Be Smaller,other Things Being

Question 56

Multiple Choice

Under what circumstances will the multiplier be smaller,other things being equal?


A) the larger the fraction of each dollar of disposable income spent on consumption
B) the larger the fraction of each dollar of disposable income that is spent on imports
C) the smaller the fraction of each dollar of disposable income that goes to saving
D) the smaller the fraction of each dollar earned that goes to taxes

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