|
If expected income
is:
|
People will
consume:
|
People expect to
save:
|
People expect to pay as
taxes:
|
Business will want to
invest:
|
Government will
spend:
|
|
980
|
724
|
148
|
108
|
216
|
50
|
|
1030
|
752
|
160
|
118
|
228
|
50
|
|
1080
|
780
|
172
|
128
|
240
|
50
|
|
1130
|
808
|
184
|
138
|
252
|
50
|
If government spending increases by 10 in the table
above, equilibrium increases from 1030 to 1080. Therefore
the multiplier in this model is:
1
1.8
2.3
5
10
|
