The Amount by Which a Change in Government Expenditures on Goods

question 215

Multiple Choice

The amount by which a change in government expenditures on goods and services is multiplied to determine the change in aggregate demand that it generates is the .

• A) increase in real GDP
• B) government expenditure multiplier
• C) goods and services multiplier
• D) slope of the AE curve

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Definitions:

Interest-Bearing Note

A debt security that pays interest to the holder until it matures, at which point the principal is reimbursed.

Discounting

The process of determining the present value of a payment or a stream of payments that is to be received in the future.

Note Payable

A financial obligation or loan documented by a written promissory note specifying repayment terms.

Interest-Bearing Note

A debt instrument or loan that accrues interest over time, which the borrower is required to pay.