The Multiplier Helps Explain

question 281

Multiple Choice

The multiplier helps explain

• A) why a rise in government expenditures causes real Gross Domestic Product (GDP) to rise by more than the amount of the increase in government spending.
• B) why an increase in disposable income causes real Gross Domestic Product (GDP) to rise by less than the amount of the increase in disposable income.
• C) why a decrease in taxes causes real Gross Domestic Product (GDP) to fall by more than the amount of the decrease in taxes.
• D) why a fall in investment cause real Gross Domestic Product (GDP) to rise by more than the amount of the decrease in investment.

---

Definitions:

High

A state of being under the influence of drugs or substances, which alters mood, perception, or consciousness.

Medium

A substance or material that carries or conducts something, such as waves or messages.

Automatic Processing

Mental operations that occur without conscious awareness or effort, allowing us to perform routine tasks quickly and efficiently.

Highly Familiar Words

Words that are well-known or commonly recognized and understood by most people.