Which of the Following Is Not an Assumption of the Simple

question 50

Multiple Choice

Which of the following is not an assumption of the simple multiplier formula?

• A)The economy has excess capacity and room to expand output.
• B)Firms will raise prices as buyers buy more of their output.
• C)People will spend more if they earn additional income.
• D)Business firms will increase production if demand for their output increases.

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Definitions:

Functionalist

Pertains to a perspective in sociology and psychology that emphasizes the importance of the roles that elements of society or cognition serve.

Psychology

The scientific study of the mind and behavior, examining how individuals think, feel, and act both as individuals and within groups.

Structuralism

Structuralism is a theoretical paradigm in psychology and other social sciences that emphasizes the analysis of underlying structures in cultural products, human thought, and behavior.

Components of Taste

The five recognized basic tastes perceived by taste receptors: sweet, sour, salty, bitter, and umami.