Suppose There Are Both Multiplier and Crowding Out Effects but Without

question 117

Multiple Choice

Suppose there are both multiplier and crowding out effects but without any accelerator effects.An increase in government expenditures would

• A)shift aggregate demand right by a larger amount than the increase in government expenditures.
• B)shift aggregate demand right by the same amount as the increase in government expenditures.
• C)shift aggregate demand right by a smaller amount than the increase in government expenditures.
• D)Any of the above outcomes are possible.

---

Definitions:

Process Cost Accounting

An accounting methodology for assigning production costs to units of output, typically used in manufacturing environments where products are identical or similar.

Mass Produced

Items that are manufactured in large quantities using standardized processes and assembly lines.

Direct Materials

Raw materials that can be directly attributed to the production of specific goods or services.

Work In Process Inventory

Inventory that includes items that are in the process of being produced but are not yet completed.