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In: Economics

23. Describe the interaction between the multiplier and accelerator following an increase in government spending.(30 marks)

23. Describe the interaction between the multiplier and accelerator following an increase in government spending.(30 marks)

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describe the interaction between the multiplier and accelerator following an increase in government spending.
describe the interaction between the multiplier and accelerator following an increase in government spending.
1.If the government spending multiplier is 1 then a $1 increase in deficit-financed government spending will...
1.If the government spending multiplier is 1 then a $1 increase in deficit-financed government spending will lead to a zero percentage increase in output. a-true b- false 2. If the marginal propensity to consume is 13 then the government spending multiplier is 3. a-true b- false 3.Which combination of policies are likely to provide Keynesian stimulus to an economy in a depression? a-Tax cuts on investment and increases in defense spending. b-An increase in the income tax rate and an...
Describe how the multiplier works when the government decreases spending? Explain how the multiplier depends on...
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3. In the multiplier-accelerator interaction model, how does cyclical time path form and what will lead...
3. In the multiplier-accelerator interaction model, how does cyclical time path form and what will lead to its divergence from long-run equilibrium output
1) How is the idea of the government spending multiplier, or multiplier effects in general, illustrated...
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How do we create money? What is government spending multiplier?
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If the economy is at full employment, increases in government spending: A) have a multiplier effect...
If the economy is at full employment, increases in government spending: A) have a multiplier effect on equilib rium output. B) have no effect on the aggregate price level. C) are primarily absorbed by price increases. D) reduce aggregate output
An increase in government spending initially and primarily shifts
An increase in government spending initially and primarily shifts aggregate demand right aggregate demand left aggregate supply right neither aggregate demand nor aggregate supply 
An increase in government spending initially and primarily shifts
An increase in government spending initially and primarily shifts  a. aggregate demand to the right.  b. aggregate demand to the left.  c. aggregate supply to the right.  d. neither aggregate demand nor aggregate supply in either direction.
An increase in government spending shifts aggregate demand
An increase in government spending shifts aggregate demand a. to the right. The larger the multiplier is, the less it shifts b. to the left. The larger the multiplier is, the farther it shifts. c. to the left. The larger the multiplier is, the less it shifts. d. to the right. The larger the multiplier is, the farther it shifts.
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