When Government Spending Is Added to the Basic Macroeconomic Model

question 131

Multiple Choice

When government spending is added to the basic macroeconomic model, the multiplier for G would

• A)be higher than the multiplier for autonomous spending.
• B)be lower than the multiplier for autonomous spending.
• C)be equal to the multiplier for autonomous spending.
• D)have no relationship to the autonomous spending multiplier.

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Definitions:

Critical Values

Thresholds in statistical hypothesis testing that determine the cutoff points for rejecting or not rejecting the null hypothesis.

T-statistic

A type of statistic used in hypothesis testing, calculated by dividing the departure of an estimated parameter from its hypothesized value by its standard error.

Sample Size

The number of observations or data points that constitute a sample in a statistical study.

Z-test

A statistical test used to determine if there is a significant difference between sample and population means.