Assuming That the Crowding-Out Effect Is $100 Billion and the Multiplier

question 6

Multiple Choice

Assuming that the crowding-out effect is $100 billion and the multiplier effect of an increase in government purchases is $120 billion, then the total effect on aggregate demand will be:

• A)an $80 billion increase
• B)an $80 billion decrease
• C)a $20 billion increase
• D)a $20 billion decrease

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Definitions:

Nucleolus

A structure located within the cell nucleus, primarily involved in the synthesis and assembly of ribosomes, essential components for protein production.

Nuclear Envelope

The double-membrane structure that encloses the nucleus of a eukaryotic cell, separating the nucleus from the cytoplasm and containing nuclear pores for transport.

Nuclear Pores

Openings in the nuclear envelope that allow the passage of ions, molecules, and RNA between the nucleus and the cytoplasm.

Lysosomes

Organelles in eukaryotic cells containing digestive enzymes used for breaking down waste materials and cellular debris.