If Investment Increases by $100 And,as a Result,GDP Ultimately Increases

question 64

Multiple Choice

If investment increases by $100 and,as a result,GDP ultimately increases by $200,the multiplier equals

• A)1
• B)2
• C)3
• D)4
• E)5

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Definitions:

Bank Charges

Bank charges are fees imposed by banks for various services, including account maintenance, transactions, overdrafts, and loan management.

Treasury Bills

Short-term government securities issued at a discount from the face value and mature in a year or less, representing a secure, low-risk investment.

Net Present Value

A valuation method that calculates the present value of expected future cash flows minus initial investment, used to assess investment opportunities.

Lockbox System

A service provided by banks to companies for the receipt of payment from customers, under which the payments are directed to a special post office box instead of the company’s corporate address.