If Investment Increases by $300 And, in Response, Equilibrium Aggregate

question 358

Multiple Choice

If investment increases by $300 and, in response, equilibrium aggregate expenditure increases by
$600, the multiplier is

• A) 0.2.
• B) 0.5.
• C) 5.
• D) 2.

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Definitions:

12b-1 Fee

A fee that mutual funds may charge for marketing, distribution, and service expenses, expressed as a percentage of assets under management.

Net Asset Value

The value per share of a fund, calculated by dividing the total value of the fund's assets minus its liabilities by the number of shares outstanding.

Year-End Assets

These are the total value of all assets that a company or individual owns at the end of the fiscal year.

Liabilities

Financial obligations or debts owed by a business to creditors, which must be paid back at some point in the future.