Question

12) (2pts) refers to the phenomenon in which a small increase or decrease in consumer demand can produce a much larger change in demand for the facilities and equipment needed to make the consumer product. The multiplier effect O Reciprocity Fluctuating demand Inelastic demand (2pts) 13) The firms belonging to construction, manufacturing, transportation, finance, real estate, and food service industries, fall under the category of O resellers O producers O distributors O governments

Answer 1

12) The multiplier effect refers to the phenomenon in which a small increase or decrease in consumer demand can produce a much larger change in demand for the facilities and equipment needed to make the consumer product. The size of the multiplier depends upon the households marginal propensity to consume.

Ans. (A)

13) Producers are the firms belonging to construction, manufacturing, transportation, finance, real estate, and foodservice industries. They are often also called as original equipment manufacturers or OEMs

Ans. (B)