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    Principles of Macroeconomics
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    Exam 13: Consumption and the Aggregate Expenditures Model
  5. Question
    The Smaller the Marginal Propensity to Consume
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The Smaller the Marginal Propensity to Consume

Question 19

Question 19

Multiple Choice

The smaller the marginal propensity to consume,


A) the greater of the multiplier.
B) the lower the value of the multiplier.
C) the greater the initial change in real GDP.
D) the greater the initial change in aggregate expenditures.

Correct Answer:

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