The ________ View Says That Fiscal Stimulus Has a Multiplier

question 167

Multiple Choice

The ________ view says that fiscal stimulus has a multiplier effect that makes it a ________ tool to fight a deep recession.

• A) mainstream; powerful
• B) "free lunch"; powerful
• C) Keynesian; powerful
• D) Keynesian; weak
• E) None of the above answers is correct.

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Definitions:

Effective-interest Method

An accounting practice for amortizing the discount or premium on bonds or loans in a way that reflects a constant interest rate over the period.

Book Value

The net value of a company's assets minus its liabilities and intangible assets, often used to assess the company's worth.

Bond Liability

A financial obligation representing money owed by an issuer to the holder of the bond, to be repaid at a future date, along with periodic interest payments.

Straight-line Method

A depreciation method that allocates an equal amount of the asset's cost to each year of its useful life.