The Following Information Is for a Closed Economy

question 107

Multiple Choice

The following information is for a closed economy:

-Refer to the above information.The introduction of $80 billion of government spending has:

• A) lowered the multiplier from 2.5 to 2.0.
• B) increased the multiplier from 2.5 to 3.0.
• C) increased the multiplier from 2.0 to 2.5.
• D) had no effect on the size of the multiplier.

---

Definitions:

Possess

To have or hold something as one's own, to control or occupy something whether physically or legally.

Ownership

The legal right to possess, use, and dispose of something, encompassing both tangible and intangible assets.

Subrogation

The legal right of an insurance company to pursue a third party that caused an insurance loss to the insured, in order to recover the amount of the claim paid to the insured.

Creditor

An entity or person to whom money is owed by another entity or person.