Question

calculate the value of Multiplier if the value of MPc is 0.2​

Answer 1

Answer:

the multiplier is 3 then the marginal propensity to save must be 1/3 and the ... We can infer from the information that the value of the multiplier = 5 ... Then the MPC = 1-0.2 = 0.8 ...

Answer 2

The value of Multiplier is 1.25 if the value of MPc is 0.2​.

1. MPC is the marginal propensity to consume. It measures the marginal increase in consumption with a unit change in the level of income.
2. Multiplier is measure that shows how change in one variable brings about multiple time change in another variables.
3. The formula to calculate multiplier is :

1/1-MPC

= 1/1-0.2

= 1/0.8

= 1.25