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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Definitions:

Theory Y

is a management approach that assumes employees are self-motivated, enjoy work, and will seek and accept responsibility and challenges.

Douglas McGregor

An influential social psychologist who proposed Theory X and Theory Y to describe different attitudes towards workforce motivation and management.

Fishbone Diagram

A visual tool that identifies, organizes, and displays possible causes of a problem or condition. It is also known as a cause-and-effect diagram or Ishikawa diagram.

Philip B. Crosby

An American businessman and author who contributed significantly to management theory and quality improvement practices.