The Multiplier Principle Explains How

question 172

Multiple Choice

The multiplier principle explains how

• A)any change in the economy has a one-time impact.
• B)$1 invested will increase GDP by more than $1.
• C)expenditures and incomes decrease as investment increases.
• D)$1 invested will decrease GDP by less than $1.

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Definitions:

Real Wages

Wages adjusted for inflation, representing the purchasing power of income earned from work.

Workers

Individuals engaged in various occupations, typically employed to perform specific tasks or services in exchange for compensation.

Strike

A work stoppage caused by the mass refusal of employees to work, usually in protest against labor conditions, policies, or other employment issues.

Factory Inspectors

Officials responsible for examining production facilities to ensure they comply with labor laws, safety standards, and health regulations.