The ratio of the total increment in equilibrium value of final goods output to the initial increment in autonomous expenditure is called?
The ratio of the total increment in equilibrium value of final goods output to the initial increment in autonomous expenditure is called?
Solution
✅ Correct Option: 2
The investment multiplier is the ratio of the total increase in equilibrium output of final goods to the initial increase in autonomous expenditure: , where is the MPC.
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