If C = a + bY, which of the following is true?
A)If a increases, autonomous saving will increase.
B)If a increases, the multiplier will increase.
C)If a increases, the multiplier will decrease.
D)If b increases, the multiplier will increase.
E)If b increases, the multiplier will decrease.

Question

Quizplus · Accepted Answer

The multiplier is determined by the marginal propensity to consume, which is represented by 'b' in the equation. If 'b' increases, the marginal propensity to consume increases, leading to a larger multiplier.

If C = a + BY, Which of the Following