Because a Decrease in Real Autonomous Spending Results in a ________

question 8

Multiple Choice

Because a decrease in real autonomous spending results in a ________ in the price level, the ultimate effect on real GDP is ________ that predicted by the multiplier.

• A) fall; smaller
• B) fall; larger
• C) rise; smaller
• D) fall, smaller

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Definitions:

Cost of Goods Sold

The total cost directly involved in producing goods or services, which are sold during a particular period.

Weighted-Average

A method used to calculate an average whereby different values have different levels of importance or "weights".

Cost of Goods Sold

The immediate expenses related to the manufacture of products sold by a business, encompassing both materials and workforce.

Perpetual System

An inventory management method that records the sale or purchase of inventory immediately through the use of computerized point-of-sale systems and enterprise asset management software.