Re: marginal propensity to consume

Posted by ahlashi on May 04, 2016; 5:47pm
URL: http://discussion-forum.276.s1.nabble.com/marginal-propensity-to-consume-tp7600353p7600367.html

How i proceeded is :
given mpc=.8
so multiplier = 5
now if govt cut taxes by 200 , output rises by 5*200 = 1000
and thu offsets the initial fall