The Simple Multiplier

question 196

Multiple Choice

The simple multiplier:

• A)occurs only in response to a change in the level of investment spending.
• B)can be found by taking the reciprocal of the MPS.
• C)occurs only when intended investment increases as GDP increases.
• D)is measured by the slope of the saving schedule.

---

Definitions:

Equity

Equity refers to the ownership interest in a company, represented by the shares held by investors.

Synergistic Gains

Refers to the additional value created by combining two or more companies or entities, beyond what they could achieve individually.

Market Values

The existing rate at which an asset or service is being offered for buying or selling.

Taxable Merger

A merger in which the assets acquired are treated as sales, generating a tax liability for the selling company.