Which of the following is the formula for the multiplier?
OA. 1-MPC O
C. 1 1-MPC
B. 1 MPC OD. MPC increase in GDP on the interest rate.

Often the multiplier formula is considered to be too simple because it ignores some real world complications. Which of the following is not such a reason?
A. The formula ignores the impact of an increase in GDP on consumption.

B. The formula ignores the impact of an increase in GDP on imports.

C. The formula ignores the impact of an O

D. The formula ignores the impact of an increase in GDP on inflation.​

Answers

Answer 1

The formula to determine the multiplier(M) is:

M = 1 / (1 – MPC)

where:

MPC=Marginal propensity to consume

What Is a Multiplier?

A multiplier is a broad term in economics that refers to an economic factor that, when increased or changed, causes increases or changes in many other related economic variables. In terms of GDP, the multiplier effect causes total output gains to be greater than the change in spending that caused it.

Typically, the term multiplier refers to the relationship between government spending and total national income. The deposit multiplier is another multiplier used to explain fractional reserve banking.

Often the multiplier formula is considered to be too simple because it ignores some real-world complications. The Reason is:

Option A. The formula ignores the impact of an increase in GDP on consumption.

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Related Questions

Two antigens, antigen A and antigen B, determine the four major human blood groups: A, B, AB, and O. The table below shows the percentage distribution of blood groups for the Caucasian population in the United States (American Red Cross, 2016) ABAB Blood group AntigenA B BNone Distribution 40\% 11% 445% Calculate the probability of randomly picking a blood sample that contains only one antigen, that is, a blood sample that belongs to either blood group A or blood group B. Probability = (Enter an integer)

Answers

The probability of randomly picking a blood sample that contains only one antigen, that is, a blood sample that belongs to either blood group A or blood group B is 51%.

What is probability?

Probability is defined as a field of mathematics that focuses on calculating the likelihood that an event will occur. A probability is a numerical representation of the likelihood or chance that a specific event will take place.

Probability = Favorable outcome / Total outcome

Antigen A = 40%

Antigen B = 11%

Antigen AB = 4%

Blood group O = 45%

Probability of randomly picking a blood sample that contains only one antigen

= 40 + 11 / 40 + 11 + 4 + 45

= 0.51

= 51%

Thus, the probability of randomly picking a blood sample that contains only one antigen, that is, a blood sample that belongs to either blood group A or blood group B is 51%.

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