Consider a Simple Macro Model with a Constant Price Level

question 119

Multiple Choice

Consider a simple macro model with a constant price level and demand-determined output.If the marginal propensity to spend in such a model is 0.4,the simple multiplier is

• A)0.
• B)0.4.
• C)1.67.
• D)2.5.
• E)4.0.

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Definitions:

Learning

Relatively permanent change in an animal’s behavior that results from practice and experience.

Behavior

Observable, coordinated responses to environmental stimuli.

Stimulus-Response

A concept in psychology and physiology describing how organisms respond to stimuli in their environment.

Operant Conditioning

Learning that results from rewarding or reinforcing a particular behavior.