Which of the following is a true statement about the multiplier?
A) The multiplier is a value between zero and one.
B) The smaller the MPC, the larger the multiplier.
C) The multiplier rises as the MPC rises.
D) The multiplier effect does not occur when autonomous expenditure decreases.
C
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Which of the following is a similarity between a monopoly and an oligopoly with differentiated products?
A) There are no barriers to entry in both markets. B) The long-run equilibrium price in both markets exceeds marginal cost. C) There is a single seller in both markets. D) Firms in both the markets earn zero profit in the long run.
If you withdraw currency from your bank savings account, you are
A) increasing M1, decreasing M2. B) increasing both M1 and M2. C) decreasing both M1 and M2. D) not affecting M1 or M2. E) increasing M1 but not affecting M2.
Crowding out refers to the effect that:
A. C and I are indirectly affected by changes in G. B. C is directly affected by changes in G. C. C and I are directly affected by changes in G. D. C and I are completely unrelated to changes in G.
Total costs divided by output equals ______.
Fill in the blank(s) with the appropriate word(s).