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.
75 exam-style questions on Edexcel A A Level Economics 2.4 National income, covering 2.4.1 National income, 2.4.2 Injections and withdrawals, 2.4.3 Equilibrium levels of real national output, and 2.4.4 The multiplier. Each one has a worked solution and a mark scheme showing where the marks go.