Based on Our Understanding of the Model Presented in Chapter

question 18

Multiple Choice

Based on our understanding of the model presented in Chapter 3,a reduction in investment will cause

• A)an increase in the multiplier.
• B)a reduction in the multiplier.
• C)a reduction in the marginal propensity to save.
• D)a reduction in output.
• E) both B and D

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Definitions:

Organization Chart

A diagram that shows the structure of an organization and the relationships and relative ranks of its parts and positions/jobs.

Opportunity Costs

The cost of choosing one option over another, typically the most valuable foregone alternative.

Consistency

The quality of always behaving or performing in a similar way, maintaining uniformity across situations or time.

Intentionality

The state of being deliberate or purposeful in one's actions or decisions, implying a conscious intent.