Homework Answers
Multiplier is change in output due to change in autonomous variable.
Multiplier = 1 ÷ ( 1 - marginal propensity to consume ) = 1 ÷ ( 1 - c )
We know, marginal propensity to save = s = 1 - c
So, multiplier = 1 ÷ ( 1 - c ) = 1 ÷ s = 1/s
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