Calculate the Government Spending Multiplier If, an Increase in Government

question 44

Multiple Choice

Calculate the government spending multiplier if, an increase in government spending by $5 million increases real GDP by $25 million.

• A)0.2
• B)0.5
• C)2
• D)5
• E)6

---

Definitions:

Entity Mind-Set

A cognitive framework in which an individual perceives abilities and traits as fixed and unchangeable.

Incremental

Refers to something happening in small steps or stages.

Malleable

Describing something that is capable of being shaped, influenced, or altered; often used in the context of personal attributes or abilities.

Attributional

Relating to the process of explaining the causes of behavior and events, including the attributions we make to understand others' actions.