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Income Determination & the Multiplier · Question 31 of 58

Question 31

EasyOriginal question

If the MPS is 0.2, the investment multiplier is

0.2Correct answerYour answer0.8Correct answerYour answer1.25Correct answerYour answer5Correct answerYour answer

Show the answer and explanation

CorrectNot quiteAnswer D

Correct answer: D

k = 1 ÷ MPS = 1 ÷ 0.2 = 5.

Concept: k from the MPS
Typical timeTypical: 40 s
Your timeYours: —

The rule this testsThe investment multiplier

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