If the Expenditure Multiplier Is 5, the Slope of the Aggregate

question 231

Multiple Choice

If the expenditure multiplier is 5, the slope of the aggregate expenditure (AE) curve is

• A) 0.5.
• B) 0.6.
• C) 0.7.
• D) 0.8.
• E) 0.2.

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Definitions:

Using Algorithms

The practice of applying a step-by-step procedure or formula for solving problems or performing tasks.

Confirmation Bias

The tendency to search for, interpret, favor, and recall information in a way that confirms one's preexisting beliefs or hypotheses.

Representativeness Heuristic

A cognitive bias in decision making, where the likelihood of an event is estimated based on how similar it is to the typical case.

Convergent Thinking

A cognitive process in which a single, correct solution to a problem is identified through logical reasoning.