Question

Explain the working of investment multiplier with the help of a numerical example.

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Answer 1

Understanding the Investment Multiplier

The investment multiplier tries to determine the economic impact of public or private investment.

Answer 2

Answer:

Explain the working of investment multiplier with the help of a numerical example. Since MPC = 0.8, the income earners speed Rs 800 on consumption. This raises the income of the suppliers of consumption goods by Rs 800. ... In this way national income goes on national income goes on increasing round after round.

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