Question

explain the multiplier mechanism and it's working​

Answer 1

Multiplier is the ratio of the final change in income to the initial change in investment. K = ∆Y/∆I, i.e., K (multiplier) is equal to the ratio of the increase in income to the increase in investment, which is responsible for the rise in income. ADVERTISEMENTS: Thus, if investment in the economy increases by Rs.

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Answer 2

Multiplier is the ratio of the final change in income to the initial change in investment.k=∆Y/∆I,i.e;k (multiplier) is equal to the ratio of the increase in income to the increase in investment , which is responsible for the rise in income. Advertisments : thus, if investment in the economy increase by RS.