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The multiplier and the accelerator

Easy Medium Hard

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Question 4

In an open economy, a government injection of £8 billion results in a total increase in national income of £20 billion. If the marginal propensity to save ( $M P S$ ) is 0.22 and the marginal rate of taxation ( $M R T$ ) is 0.11, what is the marginal propensity to import ( $M P M$ )?

A

$0.07$

B

$0.27$

C

$0.67$

D

$0.73$

Markscheme

The multiplier and the accelerator Questions

A Level
Economics
The multiplier and the accelerator

22 exam-style questions on OCR A Level Economics The multiplier and the accelerator. Each one has a worked solution and a mark scheme showing where the marks go.

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