Assume that the government spending on infrastructure increased by Kshs 80 million with MPC of 3 5, marginal propensity to tax of 1 6, and marginal propensity to import of 1 8 Determine the change in equilibrium income (10 marks) b) Explain the factors that limit the application of the multiplier ...

To determine the change in equilibrium income we can use the expenditure multiplier formula Multiplier 1 1 MPC Given that the MPC marginal propensity to consume is 35 we can calculate the multiplier a ...

Assume that the government spending on infrastructure increased by Kshs. 80 million with MPC of 3/5,...

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Macroeconomics

ISBN: 978-0138014919

12th edition

Authors: Robert J Gordon

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Posted Date: Jun 26, 2023 09:24 AM

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Assume that the government spending on infrastructure increased by Kshs. 80 million with MPC of 3/5,...

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Macroeconomics

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