The formula to determine the multiplier(M) is:
M = 1 / (1 – MPC)
where:
MPC=Marginal propensity to consume
What Is a Multiplier?
A multiplier is a broad term in economics that refers to an economic factor that, when increased or changed, causes increases or changes in many other related economic variables. In terms of GDP, the multiplier effect causes total output gains to be greater than the change in spending that caused it.
Typically, the term multiplier refers to the relationship between government spending and total national income. The deposit multiplier is another multiplier used to explain fractional reserve banking.
Often the multiplier formula is considered to be too simple because it ignores some real-world complications. The Reason is:
Option A. The formula ignores the impact of an increase in GDP on consumption.
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Answer:
Check below for answers and explanations
Explanation:
a) Crystallized intelligence is a form of knowledge that is garnered from past experiences or adequate study. Lucy has previously worked in the library as a high school student before going there for the volunteering service. The experiences she has gotten from her past works in the library will be deployed into her current program for a successful outcome.
b) Alrtruism is a philosophical term that describes the concern of an individual for the well-being of others. Lucy's volunteering service that is targeted at assisting disadvantaged children is a proof of her altruistic lifestyle.
c)The Big five trait of extraversion describes how sociable a personality is. While Lucy was walking in her community library, a good number of children visited, her return to the library to organize a program for children proves that she loves being around and socializing with children.
d) The Broca's area is a part of the brain that plays a vital role in producing and understanding speeches. For Lucy to organize such a developmental program like this, she must be very eloquent with an admirable leadership skills. Her ability to even attend to library users as a high school student is a proof that she has a sound oratory prowess.
e) Self efficacy is the ability to control one's actions and deal with situations that require critical decision making. Lucy's decision to leave a paid job that doesn't give her satisfaction for a volunteering program in the library is an attribute of self efficacy.
f) Episodic memory is the process of bringing back and combining past experiences and events. Lucy recalled how much she enjoyed working at the library and decided to return there.
g) Self actualization is a fulfilment of one's dreams and goals. Lucy's return to the Library is like bringing back the sweet work experiences she once had. This indeed is self actualization.
