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K = 1/1 – mpc where K: multiplier ?Y = k?C
Mpc: marginal propensity to consume
1 – mpc: Marginal propensity to save (mps)
The simple multiplier (k) is an increasing function of the marginal propensity to consume (mpc) i.e an increase (decrease) in mpc increases (decreases) the multiplier (k) by reducing (increasing) the size of ( 1 – mpc) i.e mps; The multiplier (k) is the reciprocal of the marginal propensity to save; (k = 1/mps)
Wilfykil answered the question on February 7, 2019 at 05:09
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