The Expenditure Multipliers Occur Because

question 109

Multiple Choice

The expenditure multipliers occur because

• A)a change in autonomous expenditure causes real GDP to change in the opposite direction.
• B)government expenditure on goods and services change by an amount proportional to government taxes.
• C)a change in households' incomes changes autonomous expenditure.
• D)any change in real GDP must also change the price level.
• E)a change in autonomous expenditures changes households' incomes.

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Definitions:

P-value Method

A statistical approach that determines the significance of results by comparing the p-value to a predetermined level of significance, often determining if there is enough evidence to reject a null hypothesis.

Rejection Region

The range of values for which the null hypothesis is rejected in hypothesis testing, based on the chosen significance level.

Level Of Significance

The probability threshold below which the null hypothesis is rejected in statistical testing, indicative of the risk of a Type I error.

Statistically Significant

Statistically significant results indicate that the observed effects or differences in a study are unlikely to be due to chance, based on a predetermined significance level.