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The government decides to inject $200 million into the economy to build affordable new houses. This will have a multiplier effect in the economy. Out
The government decides to inject $200 million into the economy to build affordable new houses. This will have a multiplier effect in the economy. Out of this, $175,000,000 will be consumed. Please define marginal propensity to consume and marginal propensity to save (2) Calculate MPC and MPS (2) Calculate the multiplier (1) Calculate the increase in new GDP due to this effect (1) Assume, you earn $52,000 and you save $2,000. What is your APC? (2)
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