As the Marginal Propensity to Consume (MPC) Increases, the Spending

question 19

Multiple Choice

As the marginal propensity to consume (MPC) increases, the spending multiplier

• A) increases.
• B) decreases.
• C) remains constant.
• D) becomes indefinable.

---

Definitions:

Probabilistic Model

A statistical model that incorporates randomness and uncertainty, and uses probabilities to predict outcomes.

Stochastic Model

A model that incorporates randomness and unpredictability, often used in various fields to simulate the behavior of complex systems under uncertainty.

Hiring Additional Employees

The process of recruiting and adding new staff to an organization's workforce to accommodate growth, fill vacancies, or enhance capabilities.

Growth Percentage

A measure of financial or business expansion, calculated by comparing an increase in size or value over a particular period.