If the Government Spends $1 Billion to Create a Wetlands

question 15

Multiple Choice

If the government spends $1 billion to create a wetlands preserve, taxes increase $1 billion to pay for it, and the marginal propensity to consume is 0.75, GDP:

• A) remains unchanged.
• B) increases by $1 billion.
• C) increases by $4 billion.
• D) decreases by $1 billion.

---

Definitions:

Compliance Strategies

Techniques used to persuade or influence someone to conform to rules or wishes.

Persuasion

The process of convincing someone to do or believe something through reasoning or the use of emotion.

Lower Power Parties

Those participants in a negotiation or conflict who possess less influence, resources, or status compared to other parties involved.

Business Deals

Agreements or transactions between businesses or individuals for the purchase, sale, or exchange of goods, services, or information.