A Decrease in the Marginal Propensity to Import Will Cause

question 12

Multiple Choice

A decrease in the marginal propensity to import will cause:

• A) the multiplier to increase and a given change in government spending to have a larger effect on domestic output.
• B) the multiplier to increase and a given change in government spending to have a smaller effect on domestic output.
• C) the multiplier to decrease and a given change in government spending to have a larger effect on domestic output.
• D) the multiplier to decrease and a given change in government spending to have a smaller effect on domestic output.
• E) the multiplier to increase and a given change in government spending to have no effect on domestic output.

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Definitions:

Woodrow Wilson

The 28th President of the United States, serving from 1913 to 1921, known for his progressive reforms and leadership during World War I.

Federal Economic Policy

Government strategies and actions aimed at influencing or controlling the economy of a nation, including taxation, spending, and monetary regulation.

Legislative Achievements

Refers to the successful enactment of laws or statutes by a legislative body, such as a parliament or congress, which often reflects the body's effectiveness or priorities.

New Freedom

A collection of speeches Woodrow Wilson made during his presidential campaign of 1912, promising significant reforms for greater economic opportunity for all, while ensuring the tradition of limited government.