Multiple Choice
Because of the multiplier, a one-time change in expenditure will
A) have little secondary effect on real GDP.
B) expand real GDP by an infinite amount.
C) generate more additional real GDP than the initial change in expenditure.
D) decrease saving and investment activity and thereby decrease future real GDP.
Correct Answer:
Verified
Correct Answer:
Verified
Q127: Explain what happens to equilibrium expenditure if
Q128: Suppose the MPC = 0.90 and there
Q129: At the equilibrium level of aggregate expenditure,
Q130: Suppose that firms find that their inventories
Q131: If the marginal propensity to import increases,
Q133: The slope of the aggregate expenditure curve
Q134: The multiplier is 2.5 and the SAS
Q135: <img src="https://d2lvgg3v3hfg70.cloudfront.net/TB8586/.jpg" alt=" -The figure shows
Q136: In general, the steeper the aggregate expenditure
Q137: In the short run, an upward shift