Suppose the Simple Multiplier Is 8

question 105

Multiple Choice

Suppose the simple multiplier is 8.What is the marginal propensity to consume?  

• A) 1/8 
• B) 1/4 
• C) 4/5 
• D) 7/8

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Definitions:

Domestic Market

Refers to the supply and demand of goods and services within a specific country.

Joint Venture

A business arrangement in which two or more parties agree to pool their resources for the purpose of accomplishing a specific task, project, or business activity.

Profit Potential

Profit potential refers to the capacity of a business or investment to generate earnings over time, considering factors like market demand, competition, and cost structures.

Local Workforce

refers to employees or laborers who live in the surrounding area or community where the business or industry operates, often contributing to local economic development.