Table 36-2 in Table 36-2, Assume That Exports Rise

question 155

Multiple Choice

Table 36-2 In Table 36-2, assume that exports rise to $900. How large is the multiplier?

• A) 5
• B) 4
• C) 2.5
• D) 2

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Definitions:

Taxation

Taxation is the process by which governments finance their expenditure by imposing charges on citizens and corporate entities.

Excise Taxes

Taxes imposed on specific goods, services, or transactions, often including alcohol, tobacco, and gasoline, generally used to discourage consumption or raise revenue.

Elasticity

A measure of how much the quantity demanded or supplied of a good responds to changes in prices, income, or other economic factors.

Price Elasticity

A measure of how much the quantity demanded of a good changes in response to a change in its price.