Which of the Following Best Defines the Multiplier Effect

question 118

Multiple Choice

Which of the following best defines the multiplier effect?

• A) the multiplied impact on the money supply of a given increase in government purchases
• B) the multiplied impact on tax revenues of a given increase in government purchases
• C) the multiplied impact on investment of a given increase in interest rates
• D) the multiplied impact on aggregate demand of a given increase in government purchases

---

Definitions:

Psychoanalytic Theory

A theory of personality development and therapeutic framework that emphasizes unconscious motives and conflicts, developed by Sigmund Freud.

Humanist Theory

A psychological perspective that emphasizes the study of the whole person and the uniqueness of each individual, often associated with concepts of free will and self-actualization.

Genetic Theory

A theory that explains traits, behaviors, and conditions primarily through the influence of genetic information and heredity.

Cognitive Theory

A psychological approach that emphasizes the role of mental processes in understanding behavior, emotions, and thought patterns.