# Relationship between mps and multiplier formula

### MPC and multiplier (video) | Multipliers | Khan Academy

The marginal propensity to save (MPS) is the fraction of an increase in income that is not spent The MPS plays a central role in Keynesian economics as it quantifies the to save is also a key variable in determining the value of the multiplier. Since MPS is measured as ratio of change in savings to change in income. The marginal propensity to save, MPS, is the ratio of the change in savings to change in income. Calculate the GDP multiplier, which is 1 / (1 - MPC). Substituting 1 How to Calculate Percentage Decrease on a Calculator. CFA Level 1 - The Multiplier Effect. The marginal propensity to consume (MPC) is equal to ΔC / ΔY, where ΔC is The expenditure multiplier is the ratio of the change in total output induced by an autonomous expenditure change. The previously mentioned formula for calculating the multiplier is a simplified one.

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