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A $1 Increase in Autonomous Spending Has a Multiplier Effect

Question 57

Multiple Choice

A $1 increase in autonomous spending has a multiplier effect greater than one on total expenditures and output because


A) each expenditure is respent in the same amount continuously.
B) overtime expenditures tend to increase.
C) total expenditures include autonomous expenditures.
D) each time an expenditure occurs the recipient respends a proportion of the funds.

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