Which of the Following Quotations Illustrates the Idea of the Multiplier

question 127

Multiple Choice

Which of the following quotations illustrates the idea of the multiplier?

• A)"The new stadium will generate $200 million in spinoff spending."
• B)"Taking the grain elevator out of our small town will destroy 300 jobs."
• C)"Higher expected profits are leading to higher investment spending by business, and will lead to higher consumer spending."
• D)"The projected cuts in government jobs will hurt the local retail industry."
• E)All of the above

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Definitions:

Consumer Surplus

The difference between the total amount that consumers are willing and able to pay for a good or service and the total amount they actually pay.

Reservation Prices

The maximum price a consumer is willing to pay for a good or service, beyond which they will not purchase it.

Mixed Bundling

Selling two or more goods both as a package and individually.

Hook-up Fee

A charge for connecting to a service or utility, such as electricity, water, or the internet.