Let AE = Aggregate Expenditures, C = Consumption, I_P =

question 58

Multiple Choice

Let AE = Aggregate Expenditures, C = Consumption, I_P = Planned Investment, JG = Government Purchases. Consider a simple aggregate expenditures model, where
JAE = C + I_P + G and all components of aggregate expenditures except consumption are autonomous. In this model, the multiplier is _____.

• A) 1 ÷ (1 -MPS) where MPS = marginal propensity to save
• B) 1 ÷ MPC where MPC = marginal propensity to consume
• C) 1 ÷ MPS where MPS = marginal propensity to save
• D) MPC ÷ MPS ÷ ∆Y

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Definitions:

High Dividend

Refers to stocks or securities that pay out significant portions of profit in the form of dividends compared to their stock price.

High Dividend Payout

A scenario where a company distributes a large portion of its earnings to its shareholders in the form of dividends.

Projects

Specific tasks or programs undertaken to meet particular goals, often requiring significant time, resources, or investment.