The Multiplier Will Be Smaller, Other Things Being Equal

question 98

Multiple Choice

The multiplier will be smaller, other things being equal:

• A)the smaller the fraction of each dollar earned that goes to taxes.
• B)the larger the fraction of each dollar of disposable income that is spent on imports.
• C)the smaller the fraction of each dollar of disposable income that goes to saving.
• D)All of these answers are true.

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Definitions:

Employer-provided Insurance

Health insurance coverage provided to employees (and often their families) as part of an employment benefit package.

Birthday Rule

A rule that states that the insurance policy of a policyholder whose birthday comes first in the year is the primary payer for all dependents.

Birthday Rule

An insurance policy determination rule that establishes priority of coverage for a child when covered by both parents' plans; typically, the parent whose birthday occurs first in the calendar year holds the primary plan.

Primary Payer

The insurance or funding source that is responsible for paying a claim first, before any other coverage is considered.