An Increase in the Value of the Simple Multiplier Can

question 104

Multiple Choice

An increase in the value of the simple multiplier can be caused by

• A)a decrease in the marginal propensity to consume.
• B)an increase in the marginal propensity to import.
• C)an increase in the net tax rate.
• D)an increase in the marginal propensity to save.
• E)a decrease in the net tax rate.

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Definitions:

Accomplished Teachers

Educators who have achieved a high level of expertise and excellence in their teaching practices.

Moral Hazard

A situation in economics where one party is more likely to take risks because the costs that could result will not be borne by the party taking the risk.

Unobservable Characteristics

Traits or attributes of an entity that cannot be directly measured or seen but influence outcomes.

Adverse Selection

Adverse selection is a situation in which an asymmetry of information between buyers and sellers results in the failure to facilitate optimal market outcomes, often seen in insurance markets where those most likely to claim insurance are also the most likely to purchase it.