MPC and multiplier
9:53
Khan AcademySal Khan
MPC and multiplier
The expenditure and tax multipliers depend on how much people spend out of an additional dollar of income, which is called the marginal propensity to consume (MPC). In this video, you'll explore the intuition behind the MPC using a simple economic example, and will learn how to use the MPC to calculate the expenditure multiplier.
May 7, 2012
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