The AD shortfall divided by the multiplier is equal to:
A. The MPC.
B. Desired fiscal stimulus.
C. Total gain in income generated from lower spending.
D. First-round consumption that is lost from higher taxes.
Answer:B
The AD shortfall divided by the multiplier is equal to:
A. The MPC. B. Desired fiscal stimulus. C. Total gain in income generated from lower spending. D. First-round consumption that is lost from higher taxes.