Very happy to be able to help, I'm just finishing a comprehensive video on aggregate expenditure that will go up soon. It's a tougher topic so I wanted to make sure I made it clear to understand.
I'll be getting at least a few out before then. Some of the aggregate expenditure videos require a lot more time and can't be rushed otherwise I'll be sacrificing quality and giving you a poorly produced video.
In the second problem, i dont get how you calculated you the multiplier. I mean why are we dividing 1500 with 300bn, isn't the formula for multiplier 1/1-MPC or 1/MPW
The multiplier shows us the overall impact of an increase in spending, which includes the initial expenditure. The multiplier ratio is a ratio between change in real income and the initial injection.
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Thank you for the new videos. I hope to see the rest of Chapter 4 soon :). It helps me revise a lot!
Very happy to be able to help, I'm just finishing a comprehensive video on aggregate expenditure that will go up soon. It's a tougher topic so I wanted to make sure I made it clear to understand.
@@EnhanceTuition Thank you for your effort, I really appreciate it.
thanks sir
I'll be getting at least a few out before then. Some of the aggregate expenditure videos require a lot more time and can't be rushed otherwise I'll be sacrificing quality and giving you a poorly produced video.
Thank you so much for the lessons!
My pleasure!
Please if it’s a 3 sector economy, can I use the 1/MPS which is for problem 1
Multiplier should be 4 in 2nd example. Govt spends 300 benefit gained is (300*4)=1200
Or u meant to write a ‘further’ increase in 1200 otherwise it means a total increase in consumption by 1200 hence multiplier 4
Thanks a lot man your saving lives out here 🫡
In the second problem, i dont get how you calculated you the multiplier. I mean why are we dividing 1500 with 300bn, isn't the formula for multiplier 1/1-MPC or 1/MPW
Good question. You can calculate the multiplier by also dividing the change in real GDP by the inital change in spending.
right, thank you!
thank you very much! so as long as the model dose not include international trade, it is a close economy, am I right?
In problem 2 why isn’t the multiplier 4? Like with an investment of 300b, the gain in 1200.
The multiplier shows us the overall impact of an increase in spending, which includes the initial expenditure. The multiplier ratio is a ratio between change in real income and the initial injection.
Thank you GOSH