The Expenditure Multiplier Indicates That

question 33

Multiple Choice

The expenditure multiplier indicates that

• A) changes in investment, government, or consumption spending can trigger much larger changes in output.
• B) an increase in saving will cause output to rise by a multiple of the additional saving.
• C) a market economy will be more stable than classical economists thought.
• D) the marginal propensity to consume is greater than one.

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