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Suppose an Initial Increase in Government Expenditure Increases Output by $50,000

Question 115

Multiple Choice

Suppose an initial increase in government expenditure increases output by $50,000. If the size of the multiplier was 1.0, the size of the initial increase in government expenditure was _____


A) $25,000.
B) $20,000.
C) $12,500.
D) $50,000.
E) $0.

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