In the Simple Aggregate Expenditure Model Where All Components of Aggregate

question 201

Multiple Choice

In the simple aggregate expenditure model where all components of aggregate expenditure are autonomous except consumption, what is the value of the multiplier if the slope of the aggregate expenditures curve is 0.8?

• A) 1
• B) 4
• C) 5
• D) Cannot be determined without information on marginal propensity to consume.

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Definitions:

Performance Measures

Quantitative indicators used to assess how well an individual, organization, or system is performing against expected objectives.

Strategic Business Unit

A division or unit within a larger company that focuses on a specific market segment or product line, operating with its own strategy and objectives.

Merit Pay

A salary increase awarded to employees based on their job performance, acting as a motivational tool by rewarding high performers.

Unit Performance

The measurement of the efficiency, effectiveness, and productivity of a specific department or operational unit within an organization.