How Is the Multiplier Calculated in an Open Economy with Government

question 25

Multiple Choice

How is the multiplier calculated in an open economy with government sector?

• A) 1/(marginal propensity to consume + marginal propensity to save + marginal propensity to export)
• B) 1/(marginal propensity to consume)
• C) 1/(marginal propensity to tax + marginal propensity to export)
• D) 1/(marginal propensity to consume + marginal propensity to tax + marginal propensity to

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