An Increase in the MPC

question 73

Multiple Choice

An increase in the MPC

• A)increases the multiplier,so that changes in government expenditures have a larger effect on aggregate demand.
• B)increases the multiplier,so that changes in government expenditures have a smaller effect on aggregate demand.
• C)decreases the multiplier,so that changes in government expenditures have a larger effect on aggregate demand.
• D)decreases the multiplier,so that changes in government expenditures have a smaller effect on aggregate demand.

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Definitions:

Article 2A

A set of laws within the Uniform Commercial Code that governs leasing of goods.

Confirmation Letter

A confirmation letter is a written document that acknowledges the details or arrangements of a prior discussion or agreement.

Counteroffer

A response to an offer in negotiations that modifies the terms of the original offer.

Sale

The exchange of goods, services, or property for money or its equivalent.