The Multiplier Effect

question 86

Multiple Choice

The multiplier effect

• A) explains what causes a recession.
• B) explains what causes an expansion.
• C) explains how the economy recovers from a recession.
• D) reinforces the negative effects of any reduction in spending.
• E) has no impact on equilibrium expenditure.

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Definitions:

Atomic Open Sentence

A sentence in formal logic that contains a variable and becomes a proposition when the variable is replaced by a definite term.

Truth-functional

Pertaining to a logical or linguistic expression whose truth or falsehood depends only on the truth or falsehood of its components.

Atomic

Pertaining to atoms, the smallest units of matter that retain the properties of an element.

Compound

A term used to describe something made up of multiple elements or parts, often leading to a more complex structure or system.