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In a laboratory, smokers are asked to "drive" using a computerized driving simulator equipped with a stick shift and a gas pedal. The object is to maximize the distance covered by driving as fast as possible on a winding road while avoiding rear-end collisions. Some of the subjects smoke a real cigarette immediately before climbing into the driver's seat. Others smoke a fake cigarette without nicotine. You are interested in comparing how many collisions the two groups have. In this study, the dependent variable is:
MPC
Stands for Marginal Propensity to Consume, which measures the portion of additional income that an individual spends on consumption.
Multiplier Value
A factor that quantifies the impact of a change in some economic activity on the rest of the economy.
MPC (Marginal Propensity to Consume)
A measure of the change in consumption resulting from a change in income; specifically, the proportion of additional income that is spent on consumption.
Multiplier
A factor by which an initial change in spending will alter total economic output by a greater amount.
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