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標題:
Urgent!!!What is multiplier??
發問:
explain the concept of the multiplier and what factors affect the size of the multiplier?? answer within 300 words please and with your own words,,thanks 更新: this question is for macro econmoics 更新 2: it is about those equilibrium expenditure and the real GDP things ~_~
最佳解答:
Multipler effect simply means that when a variable X changes by 1 unit, the variable Y may not change by just 1 unit but a mutiple of units due to whatever reasons. And there are different types of multiplier effects depending on the context. (1) Related to Simple Keynesian Model This multipler effect means that when autonomous expenditures (like autonomous consumption, investment, export, government expenditure) increase by $ C, the firms will directly earn that $ C. But in circular flow model, a firm is also a household, which will again spend a portion (marginal propensity to spend) of $ C, like x% *$ C for consumption, and the sellers this time will spend x% of their income (x% * $ C), ie x%^2 * $ C, which will again turn to the income of some other parties. When this process goes on, the aggregate income will rise by $ C / (1-x%) but not only $ C. This is the multipler effect and 1 / (1-x%) is called multipler. Depending on which exogeneous variable X you are referring to, there are different mutpliers like consumption multipler, investment multiplier, government expenditure multipler and so on. (2) Banking multipler This multipler effect means that when additional deposit of $C is made, the bank will directly take that $ C as deposit. But under fractional reserve system, the bank can lend a portion (1 - reserve ratio) of $ C, like r% *$ C for loan, and the lender will deposit a portion (1 - cash leakage ratio) like c % of their loan (r% * $ C), ie c % * r% * $ C, which will again turn toa new loan. When this process goes on, the aggregate deposit will rise by $ C / (1-c % * r %) but not only $ C. This is the multipler effect and 1 / (1-c % * r %) is called banking multipler. The money supply increases by a multiple of initial deposit. (3) IS-LM multipler This is similar to type (1) but it takes into account that the interest rate rise so resulted will lower the investment level, which reduces the aggregate income. So the IS-LM multipler is smaller than the multipler effect in type (1)
其他解答:
Urgent!!!What is multiplier??
發問:
explain the concept of the multiplier and what factors affect the size of the multiplier?? answer within 300 words please and with your own words,,thanks 更新: this question is for macro econmoics 更新 2: it is about those equilibrium expenditure and the real GDP things ~_~
最佳解答:
Multipler effect simply means that when a variable X changes by 1 unit, the variable Y may not change by just 1 unit but a mutiple of units due to whatever reasons. And there are different types of multiplier effects depending on the context. (1) Related to Simple Keynesian Model This multipler effect means that when autonomous expenditures (like autonomous consumption, investment, export, government expenditure) increase by $ C, the firms will directly earn that $ C. But in circular flow model, a firm is also a household, which will again spend a portion (marginal propensity to spend) of $ C, like x% *$ C for consumption, and the sellers this time will spend x% of their income (x% * $ C), ie x%^2 * $ C, which will again turn to the income of some other parties. When this process goes on, the aggregate income will rise by $ C / (1-x%) but not only $ C. This is the multipler effect and 1 / (1-x%) is called multipler. Depending on which exogeneous variable X you are referring to, there are different mutpliers like consumption multipler, investment multiplier, government expenditure multipler and so on. (2) Banking multipler This multipler effect means that when additional deposit of $C is made, the bank will directly take that $ C as deposit. But under fractional reserve system, the bank can lend a portion (1 - reserve ratio) of $ C, like r% *$ C for loan, and the lender will deposit a portion (1 - cash leakage ratio) like c % of their loan (r% * $ C), ie c % * r% * $ C, which will again turn toa new loan. When this process goes on, the aggregate deposit will rise by $ C / (1-c % * r %) but not only $ C. This is the multipler effect and 1 / (1-c % * r %) is called banking multipler. The money supply increases by a multiple of initial deposit. (3) IS-LM multipler This is similar to type (1) but it takes into account that the interest rate rise so resulted will lower the investment level, which reduces the aggregate income. So the IS-LM multipler is smaller than the multipler effect in type (1)
其他解答:
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What is the context of the question? A multiplier is a number to be multiplied against another number. Assume that you are doing an estimate of the cost of a project, and you number comes to $10k. Since you know that the project may overrun, you want to pad your estimate so that you will not come up short. If you are confident about the conditions and you see that there are few variations, you may choose your default multiplier of 120% to come up with a final estimate of $12k. However, if you see that the project has lots of uncertainty and you have not been able to hire enough people to cover the project, you may up your multiplier to perhaps 150% or 180%. In this case, the factors that affect the multiplier are certainty and availability of staff.
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