What is the multiplier effect in the context of investment spending?

• A. The multiplier effect refers to the proportional increase in final income that results from an injection of spending.
• B. The multiplier effect is the increase in taxes due to higher government spending.
• C. The multiplier effect is the reduction in investment spending due to inflation.
• D. The multiplier effect is the decrease in consumer spending due to increased savings.

Answer: (A)