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If the Multiplier Is 7 and If There Is No

Question 308

Multiple Choice

If the multiplier is 7 and if there is no crowding-out effect,then a $50 billion increase in government expenditures causes aggregate demand to

A) increase by $250 billion.
B) increase by $175 billion.
C) increase by $350 billion.
D) None of the above are correct.

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