Suppose an Initial Increase in Government Expenditure Increases Output by $50,000.If

question 74

Multiple Choice

Suppose an initial increase in government expenditure increases output by $50,000.If the size of the multiplier is 2.5,the size of the initial increase in government expenditure was:

• A)$25,000.
• B)$20,000.
• C)$12,5000.
• D)$1250.
• E)$30,000.