Ask Question
5 September, 23:07

In a certain economy, when income is $100, consumer spending is $60. the value of the multiplier for this economy is 4. it follows that, when income is $101, consumer spending is

+4
Answers (1)
  1. 6 September, 01:23
    0
    The multiplier is the factor by which gains in total output are greater than the change in spending that caused it. It is used in reference to the relationship between investment and total income. Let us with C denote the change in consumption and with Y the change in income. If consumption increases by X then the multiplier is:

    multiplier=1/1 - spend

    4=1/1-spend

    1-spend=4 spend=-3
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “In a certain economy, when income is $100, consumer spending is $60. the value of the multiplier for this economy is 4. it follows that, ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers