Use the following to answer questions .
Exhibit: Real GDP and the Multiplier

-(Exhibit: Real GDP and the Multiplier) What is the value of the multiplier?
A) 2.5
B) 3
C) 5
D) 15

Name: Use the following to answer questions . Exhibit: Real GDP and the Multiplier -(Exhibit: Real GDP and the Multiplier) What is the value of the multiplier? A) 2.5 B) 3 C) 5 D) 15
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Question

Use the following to answer questions .
Exhibit: Real GDP and the Multiplier
 
-(Exhibit: Real GDP and the Multiplier) What is the value of the multiplier?
A) 2.5 
B) 3 
C) 5 
D) 15

Quizplus · Accepted Answer

The multiplier is calculated as 1/(1-MPC). If the MPC is 0.6, the multiplier is 1/(1-0.6) = 2.5.

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