The Formula to Compute the Spending Multiplier Is

question 48

Multiple Choice

The formula to compute the spending multiplier is:

• A) 1 / (MPC + MPS).
• B) 1 / (1 − MPC).
• C) 1 / (1 − MPS).
• D) 1 / (C + I).

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Definitions:

Patient Protection and Affordable Care Act (PPACA)

A federal law enacted in 2010 aimed at reducing healthcare costs and increasing health insurance coverage among Americans.

Personal Mandate

The requirement under the Patient Protection and Affordable Care Act (PPACA) of 2010 that all U.S. citizens and legal residents purchase health insurance unless they are already covered by employer-sponsored health insurance or government-sponsored health insurance (Medicaid or Medicare).

Government-provided Health Insurance

Health insurance schemes funded and managed by the government to offer medical coverage to its citizens.

Insurance Exchanges

Government-regulated markets for health insurance in which individuals seeking to purchase health insurance to comply with the personal mandate of the Patient Protection and Affordable Care Act (PPACA) of 2010 will be able to comparison shop among insurance policies approved by regulators. Each state will have its own exchange.