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The Multiplier Effect of Changes in Government Purchases of Goods

Question 293

Multiple Choice

The multiplier effect of changes in government purchases of goods and services is equal to:

A) 1 / (1 - MPS) .
B) 1 / (1 - MPC) .
C) MPS / (1 - MPC) .
D) MPC / (1 - MPS) .

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