Assuming a Multiplier Effect,but No Crowding-Out or Investment-Accelerator Effects,a $100

question 80

Multiple Choice

Assuming a multiplier effect,but no crowding-out or investment-accelerator effects,a $100 billion increase in government expenditures shifts aggregate

• A)demand rightward by more than $100 billion.
• B)demand rightward by less than $100 billion.
• C)supply leftward by more than $100 billion.
• D)supply leftward by less than $100 billion.

---

Definitions:

Overhead Costs

Indirect expenses related to the day-to-day running of a business, such as rent, utilities, and administrative costs.

Merchandise Purchases Budget

A financial plan that estimates the cost of goods a business needs to buy to meet its sales goals.

Production Budget

An estimate of the total cost of production (including materials, labor, and overhead) for a specific period.

Long-Range Planning

The process of defining strategic goals and making decisions on allocating resources to pursue this strategy over an extended period, typically beyond one year.