MPC &XXX; the Multiplier
XXXXXXXβs XXXX:
Institution:
Date:
Question XXX: MPC
Marginal propensity XX XXXXXXX (XXX) is XXXXXXX XX the proportional XXXXXX in consumption that XXXXXXX from XXXXXX in XXX XXXXX XX XXXXXXXXXX income (XXXXX, 2020).
XXX XX XXXXXXX by the by XXX XXXXXXX .XXXXX XX XXX XXXXXX in XXXXX of XXXXXXXXXX income and is XXX change in consumption level.XX accordance with XXX XXXXX XXXXXXX, XXX is XXXXXXXXXX XX follows:
XXXX implies XXXX a XXXX XXXXXX in disposable income XXXXXX the level XX XXXXXXXXXXX XX XXXXXXXX by 0.X XXXXX.
Question 2: XXXXXXXX Savings
XXXXXXX is XXXX XXX XX XXXXX XXXX is XXX spent in consumption XXX XX rather XXXX for XXXXXX speculative, precautionary, or XXXXXXXXXXXXXX purposes (Christelis, 2018).
XX is XXXXX by; , XXXXX X XX the XXXXX of disposable income, X is consumption XXXXXXXXXXX, XXX S is XXXXXXX.According to XXX provided data; .Thus, the individual makes a loss XX -X in XXXXXXX which XXXXXXXX XXXXXXX XXXX he/XXX does XXX XXXXXX XXXXXXXXXX savings, XXX XXXXXXX XXX available savings to finance XXX excess XXXXXXXXXXX XXXXXXXXXXX. If savings XXX unavailable XXXX the XXXXXXXX XXXXXXXX XXX XXXXXXXXXX XXXXX and XXXXXXXX XX XXXXXX (XXXX) which is a XXXXX XX XXX/her XXXXXX XXXXXX.
XXXXXXXX 3: XXX Multiplier
The XXXXXXXXXX (k) XX calculated by where XX the level of XXXXXX in XXXX gross XXXXXXXX product (XXX) XXX is XXX XXXXXX in XXXXXXXXXX XXXXXXXXX XXXXXXXXXXX (XXXXX, XXXX).
XXXXXXXXX XX XXX given XXXX;Hence XXX multiplier is 3.
Question X: XXX XXXXXXXXXX
The multiplier (k) is calculated XX.
Since c is XXX MPC and we know XXXX XXX and marginal propensity to XXXX (XXX) XXX upto 1, then (1-c) is definitely MPS.Therefore X = X.
Question X: Change in MPS
A XXXXXX inXXXXXXX XXX XXX to XXXXXX XX shown XXXXX.
XXX formula , can be rewritten XX, XXXXX means thatSince k=5, MPS XXXX XXThe initial XXX XXX X/X which XX same as 0.XXXX and XXX XXX XXX XX 0.2.XXX XXX therefore XXXX XXXX an introduction XX a XXX cut XXXXXX the value of MPS XX XXXXXXX.
REFERENCES
Christelis, D., Georgarakos, D., Jappelli, X., &XXX; van XXXXX, X. (XXXX). XXXXXXXXXXX XXXXXXXXXXX XXX precautionary XXXXXX.Β XXXXXXXXX at XXXX XXXXXXX.
XXXXX, B., &XXX; Guerrero, X. (2017). XXXXX and aggregate fiscal XXXXXX XXXXXXXXXXX.Β Journal of Monetary XXXXXXXXX,Β 92, 16-XX.
XXXXX, X., XXXXXXXXXXX, M. X., &XXX; XXXX, J. (2020). The marginal XXXXXXXXXX XX XXXXXXX XXXX XXX business XXXXX.Β American XXXXXXXX XXXXXXX: XXXXXXXXXXXXXX,Β XX(X), XXX-XX.