Business, 18.03.2020 01:52 makaylajones74pdxtrk

The multiplier principle is important because it was central to economic theory before Keynes. implies that investment will help stabilize the economy. shows why small shifts in investment have a powerful influence on national income. illustrates why a small change in income causes a large change in saving.

Answers: 2

Show answers

Answers

Answer from: MeowieMeowMeow6500

TRUE

Explanation:

The multiplier causes output to rise by a multiple of what was originally invested. Hence, it is true that it shows why small shifts in investment have a powerful influence on national income, and that it illustrates why a small change in income causes a large change in saving.

The multiplier plays the role of reinforcing induced interaction between consumption, production, factor payments, and income that amplifies autonomous changes in investment, government spending, exports, taxes, or other shocks to the macro economy.

Answer from: lemonsalt9378

A small change in income cause a large change in savings

Explanation:

The focal principle underlying Keynes economic perspective is that any fall in investment will lead to lower interest rate. Ultimately, this reduced interest rate lead to a reduction in savings, boost more investment and spending, and subsequently spiral to a moment of stability.

For Keynes, money is the goal. Thus, the forces of demand and supplying governing money is critical to dictating the state of the economy.

When there is a drop in investment and the need to shore up the liquidity/solvency level arises, there's a remarkable drop in the interest rate. This thus motivates individuals to take advantage of such. With more money in the coffers, individuals are inclined to spending out of there own principally to earn more from the borrowed money, and also to repay the the interest and principal element. A rational individual thus prefers this to savings where he'll earn almost nothing. The resultant of these procedures is the improved economy and/money stability.

Answer from: Quest

answer; /// i believe the correct answer to the above question is(200 pounds); /good luck

Answer from: Quest

1) i would probably get rid of my phone so i get extra money 2) it probably won’t because your would have to give up a lot but u need all the things u have3) your should probably not get the laptop and just save for college

Another question on Business

Business, 22.06.2019 12:50

Suppose the real risk-free rate and inflation rate are expected to remain at their current levels throughout the foreseeable future. consider all factors that affect the yield curve. then identify which of the following shapes that the u.s. treasury yield curve can take. check all that apply.

Answers: 2

Answer

Business, 22.06.2019 17:50

The management of a supermarket wants to adopt a new promotional policy of giving a free gift to every customer who spends > a certain amount per visit at this supermarket. the expectation of the management is that after this promotional policy is advertised, the expenditures for all customers at this supermarket will be normally distributed with a mean of $95 and a standard deviation of $20. if the management wants to give free gifts to at most 10% of the customers, what should the amount be above which a customer would receive a free gift?

Answers: 1

Answer

Business, 22.06.2019 23:00

Investors who put their own money into a startup are known as a. mannequins b. obligators c. angels d. borrowers

Answers: 1

Answer

Business, 22.06.2019 23:50

For each of the following situations, indicate whether you agree or disagree with the financial reporting practice employed and state the basic assumption, component, or accounting principle that is applied (if you agree) or violated (if you disagree).wagner corporation adjusted the valuation of all assets and liabilities to reflect changes in the purchasing power of the dollar.spooner oil company changed its method of accounting for oil and gas exploration costs from successful efforts to full cost. no mention of the change was included in the financial statements. the change had a material effect on spooner's financial statements.cypress manufacturing company purchased machinery having a five-year life. the cost of the machinery is being expensed over the life of the machinery.rudeen corporation purchased equipment for $180,000 at a liquidation sale of a competitor. because the equipment was worth $230,000, rudeen valued the equipment in its subsequent balance sheet at $230,000.davis bicycle company received a large order for the sale of 1,000 bicycles at $100 each. the customer paid davis the entire amount of $100,000 on march 15. however, davis did not record any revenue until april 17, the date the bicycles were delivered to the customer.gigantic corporation purchased two small calculators at a cost of $32.00. the cost of the calculators was expensed even though they had a three-year estimated useful life.esquire company provides financial statements to external users every three years.

Answers: 1

Answer

You know the right answer?

The multiplier principle is important because it was central to economic theory before Keynes. impli...

Questions