The Multiplier Principle Indicates That If Business Decision Makers Become

question 111

Multiple Choice

The multiplier principle indicates that if business decision makers become more optimistic about the future and, as a result, increase their investment expenditures by $82 billion, real GDP

• A) will increase by less than $82 billion if the economy was initially operating well below capacity.
• B) will increase by more than $82 billion if the economy was initially operating well below capacity.
• C) will increase by more than $82 billion if the economy was initially operating at full-employment capacity.
• D) will decline if the marginal propensity to consume is less than 1.

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Definitions:

Biomedical Therapy

Treatments for psychological disorders that involve medical or physiological interventions, such as medication or surgery.

Depression

A psychiatric condition manifested by a lasting low spirit or a detachment from hobbies, severely disrupting routine life.

Antidepressant Drugs

Medications prescribed to relieve symptoms of depression by adjusting the chemical balance of neurotransmitters in the brain.

Biomedical Therapy

Treatment for psychological disorders that involves influencing brain chemistry, typically through drugs, surgical procedures, or similar medical interventions.