The multiplier

Question 1

what is a positive multiplier?

Answer 1

initial increase in an injection leads to a greater final increase in real GDP

Question 2

What is a negative multiplier

Answer 2

initial decrease in an injection leads to a greater final decrease in real gdp

Question 3

what effects the multiplier process

Answer 3

the higher the propensity to consume domestically produced goods the greater the multiplier

Question 4

mpc formula

Answer 4

change in total consumption/change in gross income

Question 5

mps

Answer 5

change in total savings/change in gross income