Consider a Simple Macro Model with a Constant Price Level

question 65

Multiple Choice

Consider a simple macro model with a constant price level and demand-determined output.In the extreme situation where the marginal propensity to spend is zero,the simple multiplier is

• A)zero.
• B)a positive number between zero and one.
• C)one.
• D)a positive number greater than one but less than infinity.
• E)infinitely large.