Suppose That a $4 Billion Increase in Government Spending Increases

question 24

Multiple Choice

Suppose that a $4 billion increase in government spending increases Real GDP by $60 billion,and that a $3 billion tax reduction increases Real GDP by $68 billion.In this situation,the tax multiplier is _______________ the government spending multiplier.

• A) less than
• B) greater than
• C) equal to
• D) none of the above

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Definitions:

Biological Perspective

A way of looking at psychological issues by studying the physical basis for animal and human behavior, involving genetics, the brain, the nervous system, and other aspects of physiology.

Major Depressive Disorder

A mental health condition characterized by persistent feelings of sadness, loss of interest in activities, and other symptoms that impair daily functioning.

Neurotransmitter Serotonin

This chemical messenger is crucial for transmitting signals in the brain and is involved in various physiological processes, including mood balance and feeling well-being.

Depression

A dilemma of mental health displayed by a consistent state of sadness or an unenthusiastic attitude towards activities, markedly disrupting daily living standards.