
Spending Multiplier
Quiz
•
Social Studies
•
12th Grade
•
Practice Problem
•
Hard
Mr Snyder
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13 questions
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1.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
If the value of the multiplier is 5, an increase in
consumer spending of $10 will result in investment increasing by $50.
investment of $10 will result in income increasing by $60.
investment of $10 will result in consumption increasing by $40.
consumption of $10 will result in investment increasing by $40.
2.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
The value of the multiplier will increase if
3.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
West Babylonia is an economy with a multiplier of 2.5. The current level of GDP is $250 million below the full employment level of GDP. For the government to close this gap, it needs to increase its spending by
$250 million.
$100 million.
$10 million.
$625 million.
4.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
In the the Nation of Eagleton, a increase in government spending of $20 billion results in an increase in gross domestic product (GDP) of $80 billion. Thus, in Eagleton the MPC is _____ and the value of the multiplier is _______.
0.80; 5
0.75; 4
0.80; 4
0.9; 10
5.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
The multiplier effect means that
consumption is usually several times as large as savings
a change in consumption can cause a larger change in investment
an increase in investment can change GDP by a larger amount
a decline in MPC can cause GDP to rise by a larger amount
6.
MULTIPLE CHOICE QUESTION
1 min • 1 pt
The multiplier is:
7.
MULTIPLE CHOICE QUESTION
1 min • 1 pt
The multiplier is useful in determining:
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