Suppose an Initial Increase in Government Expenditure Increases Output by $50,000

question 115

Multiple Choice

Suppose an initial increase in government expenditure increases output by $50,000. If the size of the multiplier was 1.0, the size of the initial increase in government expenditure was _____

• A) $25,000.
• B) $20,000.
• C) $12,500.
• D) $50,000.
• E) $0.

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Definitions:

Informative Letter

A written communication intended to provide detailed information about a particular subject or issue.

Subpoena

A document commanding a person to appear at a certain time and place to give testimony concerning a certain matter.

Testify

To make a statement based on personal knowledge or belief, under oath in a court of law.

Main Part

The central or most important segment or component of something.