If Investment Increases by $300 And, in Response, Equilibrium Aggregate

question 365

Multiple Choice

If investment increases by $300 and, in response, equilibrium aggregate expenditure increases by $600, then the multiplier must be

• A) 0.2.
• B) 0.5.
• C) 2.
• D) 5.

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Definitions:

Current Price

Current Price is the market price at which an asset or service can be bought or sold at a particular time.

Expected Dividend

The anticipated amount that will be paid out in dividends to shareholders of a company, based on past and projected profitability.

Require a Rate of Return

The minimum expected yield by investors to compensate for the risk of an investment, influencing investment decisions and value.

Expected Selling Price

The price at which an asset is projected to sell in the future, based on various factors such as market trends and economic conditions.