If an Increase in Investment Spending of $50 Million Results

question 274

Multiple Choice

If an increase in investment spending of $50 million results in a $400 million increase in equilibrium real GDP, then

• A)the multiplier is 0.125.
• B)the multiplier is 3.5.
• C)the multiplier is 8.
• D)the multiplier is 14.3.
• E)the multiplier is 50.

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