Explain the Mutiplier Effect. Try to explain it in some detail so th.pdf
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The multiplier effect describes the relationship between a nation's change in national product and its investment, calculated by the formula: multiplier = change in national product / change in investment demand. This concept illustrates how a change in investment can lead to a larger overall impact on the economy's output. Understanding this effect helps clarify how economic growth can be generated through investment increases.
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Explain the Mutiplier Effect. Try to explain it in some detail so th.pdf
- 1. Explain the Mutiplier Effect. Try to explain it in some detail so that someone who did not know anything about economics would be able to gain a fundamental understanding of it. Use a visual aid to help the observer understand the concept. Solution multiplier gives the relationship between a nations change in national product to change in its investment i.e. Multiplier= Change in national product/ Change in investment demand it means it is the process of calculation of total output of a nation with regards to total investment.