The Presence of Income Taxes and Imports Make the Multiplier

question 7

Multiple Choice

The presence of income taxes and imports make the multiplier

• A) fall in value but remain positive.
• B) rise in value.
• C) not change in value.
• D) become negative.

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Definitions:

Velocity of Money

How quickly money moves from one exchange to another and the rate of usage of a currency unit within a designated time period.

Money Supply

The full measure of financial assets available within an economy at a specific juncture.

Dodd-Frank Act

The Dodd-Frank Act is comprehensive financial reform legislation enacted in 2010 in the United States, aimed at reducing risks in the financial system by increasing transparency and accountability.

FDIC

The Federal Deposit Insurance Corporation, a U.S. government agency that insures deposits at banks and thrift institutions, safeguarding depositors' money.