Assume there is no government or foreign sector. If the multiplier is 5, a $4 billion increase in investment will cause aggregate output to increase by
A) $125 billion.
B) $80 billion.
C) $50 billion.
D) $20 billion.

Question

Quizplus · Accepted Answer

The Answer of Assume there is no government or foreign sector. If the multiplier is 5, a $4 billion increase in investment will cause aggregate output to increase by
A) $125 billion.
B) $80 billion.
C) $50 billion.
D) $20 billion.

Assume There Is No Government or Foreign Sector