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14 February, 21:36

If the multiplier is 4 and the government spends an additional $5.00 in government expenditures how many dollars of economic activity are generated?

a. $4.00

c. $10.00

b. $5.00

d. $20.00

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Answers (1)
  1. 14 February, 23:28
    0
    We simply multiply 4 by 5 to obtain:

    4 x 5

    = $20

    The answer is D.
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