Consider a two-sector model: Smaller the marginal propensity to save (MPS), (A) Steeper saving function (B) Smaller value of the multiplier (C) Consumption function has flat slope (D) Larger value of the multiplier (E) Flatter saving function Choose the most appropriate answer from the options given below:
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Keynesian cross and the multiplier has come up 167 times in 7 exams since 2006.
This question is on The investment and expenditure multiplier, part of Keynesian cross and the multiplier in Macroeconomics.
Why a change in autonomous spending changes income by a larger amount, and what sets its size.
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Question from the CUET-PG 2023 Shift 1 paper. Solutions are TestStop's own. Not affiliated with or endorsed by any examination authority.