Which of the following statements about the multiplier is most accurate?
A) The multiplier applies to both increases and decreases in initial spending.
B) The multiplier only applies to increases in initial spending.
C) The multiplier only applies to decreases in initial spending.
D) The multiplier is rarely associated with changes in investment spending.

Question

Quizplus · Accepted Answer

The multiplier effect applies to both increases and decreases in initial spending, as it measures the change in economic output resulting from a change in spending.

Which of the Following Statements About the Multiplier Is Most