5) If an increase in investment spending of $50 million results in a $400 million increase in equilibrium real GDP, then A) the multiplier is 0.125. B) the multiplier is 3.5. C) the multiplier is 8. D) the multiplier is 50.

5) If an increase in investment spending of $50 million results in a $400 million increase in equilibrium real GDP, then A) the multiplier is 0.125. B) the multiplier is 3.5. C) the multiplier is 8. D) the multiplier is 50.

Economics For Today

10th Edition

ISBN:9781337613040

Author:Tucker

Publisher:Tucker

Chapter19: The Keynesian Model In Action

Section: Chapter Questions

Problem 7SQP

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8:17 1
D) Unplanned investment
5) If an increase in investment spending of $50 million
results in a $400 million increase in equilibrium real
GDP, then
A) the multiplier is 0.125.
B) the multiplier is 3.5.
C) the multiplier is 8.
D) the multiplier is 50.

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