If the Amount of Spending in an Economy Declines by $1,000

question 238

Multiple Choice

If the amount of spending in an economy declines by $1,000 and the marginal propensity to consume is 0.8, the effect on the economy is a change of _____ in income or output.

• A) $800
• B) $1,000
• C) $1,000.0
• D) $5,000

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Definitions:

John B. Watson

An American psychologist who established the psychological school of behaviorism.

Psychological Research

The systematic investigation of scientific theories and behaviors to understand or explain psychological phenomena.

Ethical Issues

Moral challenges and concerns that arise in the practice of personal and professional conduct, affecting decisions and actions.

Animal Subjects

Non-human animals used in research to study biological, psychological, or medical processes.