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2.4.4 The multiplier

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Question 10

Following an economic restructure in the island nation of Oakhaven, economic analysts estimate that the marginal propensity to save (MPS) is 8%, the marginal propensity to tax (MPT) is 0.18, and the marginal propensity to import (MPM) is 14%.

Calculate the value of the national income multiplier for Oakhaven. Show your working.

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2.4.4 The multiplier Questions

  1. A Level
  2. /Economics
  3. /2.4.4 The multiplier