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![Economics Class 12] Explain the Concept of Money Multiplier - Teachoo](https://d1avenlh0i1xmr.cloudfront.net/f3395e20-c5e1-47cf-a6e1-bf52ee2ec371/how-does-bank-create-money---teachoo.jpg "Economics Class 12] Explain the Concept of Money Multiplier - Teachoo")
Economics Class 12] Explain the Concept of Money Multiplier - Teachoo
Calculate the value and plan ahead
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Calculate Multiplier when MPC is 4/5 and 1/2 From the calculation, establish the relation between size of Multiplier and size of MPC. When MPC (4)/(5) K=(1)/(1=0.8)=(1)/(0.2)=5 When MPC=(1)/(2) K=(1)/(1-0.5)=2 Observing the same,
