Multiple Choice
In the long run, the multiplier
A) has a larger effect on real GDP than it has in the short run, because the multiplier effect has a longer time period to exert its impact on the economy.
B) has a smaller effect on real GDP than it has in the short run because of changes in the price level.
C) can have a smaller or larger effect on real GDP than it has in the short run.
D) has a larger effect on real GDP than it has in the short run because of changes in the price level.
E) has a larger effect on real GDP than it has in the short run, because there are more induced expenditures in the long run.
Correct Answer:
Verified
Correct Answer:
Verified
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