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AP Macroeconomics
Unit 3 – National Income and Price Determination
Topic 3.2
Which of the following represents the relationship between the size of the tax multiplier and the marginal propensity to consume (MPC)?
The tax multiplier is larger than the spending multiplier when the MPC is smaller.
The tax multiplier is larger than the spending multiplier when the MPS is higher.
The tax multiplier is always larger than the spending multiplier regardless of the MPC.
The tax multiplier is always smaller than the spending multiplier regardless of the MPC.
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AP Macroeconomics - 3.2 Spending and Tax Multipliers
Key terms
Marginal Propensity to Consume (MPC)
Tax Multiplier
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Cram Mode
AP Score Calculators
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AP® and SAT® are trademarks registered by the College Board, which is not affiliated with, and does not endorse this website.
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