Assume That an Economy's Real GDP Multiplier Is 4

question 97

Multiple Choice

Assume that an economy's real GDP multiplier is 4. If this economy is in equilibrium at $2,000 billion, then which one of the following actions will bring it to a full-employment equilibrium of $1,500 billion?

• A) $500 billion spending cut.
• B) $500 billion spending increase.
• C) $125 billion spending cut.
• D) $125 billion spending increase.
• E) $2,000 billion spending cut.

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Definitions:

Processing Death

The emotional and psychological process of coping with the death of a loved one or the concept of mortality.

Acceptance

The action or process of being received as adequate or suitable, typically to embrace differences or realities without an attempt to change them.

Processing Death

The experience and psychological mechanisms involved in understanding and coping with the concept of dying or the death of someone.

Guilt

A feeling of having done wrong or failed in an obligation, often accompanied by regret and self-reproach.