Discuss How the Marginal Propensity to Consume, Imports, and Income

question 46

Essay

Discuss how the marginal propensity to consume, imports, and income tax rates influence the multiplier.

---

Definitions:

Indirect Method

A way of calculating cash flows in the cash flow statement, where net income is adjusted for changes in non-cash items and working capital.

Net Income

The total profit of a company after all expenses and taxes have been deducted from total revenue.

Sale Of Equipment

The process of disposing of fixed assets, such as machinery, for cash or other compensation.

Operating Activities

These are the core activities that generate revenue and involve expenses for a company, including sales and service provision.