The multiplier effect means that:
A)consumption is typically several times as large as saving.
B)a change in consumption can cause a larger increase in investment.
C)an increase in investment can cause GDP to change by a larger amount.
D)a decline in the MPC can cause GDP to rise by several times that amount.
Answer:C
The multiplier effect means that:
A)consumption is typically several times as large as saving. B)a change in consumption can cause a larger increase in investment. C)an increase in investment can cause GDP to change by a larger amount. D)a decline in the MPC can cause GDP to rise by several times that amount.