Question

if the marginal propensity to consume is greater than marginal propensity to save the value of multiplier will be
(a) greater than 2 (b) less than 2
(c) equal to 2 (d) equal to 5
with reasons​

Answer 1

Answer:

When MPC >MPS, then the value of multiplier will be greater than 2 because the value of multiplier is directly related to the value of marginal propensity to consume. They both are directly related. In other words when MPC is more, k the multiplier is more and vice versa.

Answer 2

Explanation:

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