Within the Keynesian Model, the Multiplier Effect Tends to

question 75

Multiple Choice

Within the Keynesian model, the multiplier effect tends to

• A) smooth out the up- and down- swings of the business cycle.
• B) promote price stability.
• C) magnify small changes in spending into much larger changes in output and employment.
• D) reduce the impact of an increase in investment on output and employment.

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