When the MPC Gets Smaller, the Spending Multiplier

question 167

Multiple Choice

When the MPC gets smaller, the spending multiplier:

• A) gets larger.
• B) gets smaller.
• C) stays the same.
• D) gets smaller at low real GDP, and larger at high real GDP.
• E) gets larger at low real GDP, and smaller at high real GDP.

---

Definitions:

Slope

The slope is the measure of the steepness or incline of a line, defined as the ratio of the vertical change to the horizontal change between two points on the line.

Sales Data

Information collected about the sales performance of products or services, often used for analysis and business strategy planning.

Advertising Data

Information collected concerning the performance and outcomes of advertising campaigns, including metrics like reach, impressions, leads generated, and sales.

Sum Of Squares

A statistical technique used to measure the dispersion or variation within a data set, calculated by squaring each deviation from the mean and summing these squares.