If government spending increases,which causes producers to hire more workers,and as a result households have more income to spend,which causes aggregate demand to increase even more,this is known as the:
A) Magnifying process.
B) Multiplier process.
C) Saving effect.
D) Fiscal effect.

Question

Quizplus · Accepted Answer

This is known as the multiplier process, where government spending leads to an increase in employment and income, which in turn leads to an increase in consumer spending and further increases in aggregate demand.

If Government Spending Increases,which Causes Producers to Hire More Workers,and