The Following Table Illustrates the Multiplier Process in a Private

question 150

Multiple Choice

The following table illustrates the multiplier process in a private closed economy: Refer to the above table.The total change in consumption resulting from the initial change in investment will be:

• A)$100
• B)$96
• C)$180
• D)$80

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Definitions:

Par Common Stock

The nominal or face value assigned to common shares in the articles of incorporation, often having little relation to the market value.

Preferred Stock

represents a class of ownership in a corporation that has a higher claim on its assets and earnings than common stock, usually with fixed dividends.

Earnings Per Share

A financial ratio that measures the amount of profit attributed to each outstanding share of common stock, indicating a company's profitability on a per-share basis.

Net Income

The total earnings of a company after subtracting all expenses from its total revenue, representing the profit or loss in a financial period.