Assume That an Economy's Real GDP Multiplier Is 4

question 102

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.

---

Definitions:

Empowering

The act of giving individuals or teams more authority and responsibility, enabling them to make decisions and contribute to organizational goals.

Service Quality

The perception of how well a service meets or exceeds customer expectations, often evaluated through dimensions like reliability, responsiveness, assurance, empathy, and tangibles.

Reliability

The probability that a machine part or product will function properly for a specified time under stated conditions.

Facilitator

An individual who enables groups and organizations to work more effectively; to collaborate and achieve synergy.