The Multiplier Is the

question 44

Multiple Choice

The multiplier is the

• A)impact that investment has on the physical capital.
• B)concept that the interest rate will induce consumption and investment spending.
• C)concept that increases in spending will cause a larger increase in equilibrium GDP.
• D)impact that expansionary fiscal policy has on recessions.

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Definitions:

Scarce Resources

Natural or man-made assets that are limited in supply, making them valuable for the production of goods and services.

Unlimited Wants

Refers to the insatiable desire of consumers to possess goods and services that provide utility, exceeding the resources available to fulfill them.

Fresh Water

Fresh water is water with a low salt concentration, found in rivers, lakes, streams, and underground aquifers, essential for drinking, agriculture, and industry.

Scarce Resource

A resource that is limited in availability and can be used up or depleted, making it valuable and subject to economic study for optimal use.