Question

The value of the multiplier is when MPC = MPS.

• A. 1
• B. 2
• C. 0.5
• D. 0.0

Answer 1

The correct option is B 2

We know, MPC + MPS = 1.

When MPC = MPS, each parameter must be equal to 0.5.

Now, Multiplier = $\frac{1}{\mathrm{MPS}}$ = $\frac{1}{0.5}$ = 2.