Question

if the government increases its Expendeture from 100 to 200 what is the additional national income that can be generated by the economy​

Answer 1

⠀⠀ ⠀ ⠀⠀ $\huge{\tt{\red{❥}\green{A}\purple{N}\pink{S}\blue{W}\orange{E}\red{R}}}$A change of, for example, $100 in government expenditures will have an effect of more than $100 on the equilibrium level of real GDP. ... This is called the multiplier effect: An initial increase in spending, cycles repeatedly through the economy and has a larger impact than the initial dollar amount spent.

Answer 2

change of, for example, 100 in government expenditures will have an effect of more than 100 in government expenditures will have an effect of more than 100 on the equilibrium level of real GDP. ... This is called the multiplier effect: An initial increase in spending, cycles repeatedly through the economy and has a larger impact than the initial dollar amount spent.

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