If the Multiplier Is 4, Equilibrium Real GDP Is $600

question 48

Multiple Choice

If the multiplier is 4, equilibrium real GDP is $600 billion, and investment is $25 billion, what will happen if investment increases to $30 billion? Real GDP will:

• A)increase to $605 billion
• B)decrease to $595 billion
• C)increase to $620 billion
• D)increase to $624 billion
• E)decrease to $580 billion

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