Question: Calculate the multiplier for the following cases. Assume that the MPC value as given shows the value as a portion of national income, not disposable income.
a. MPC = 0.9, MPM = 0.2, Tax rate = 0.1
b. MPS = 0.2, MPM = 0.0, Tax rate = 0.3
c. MPS = 0.1, MPM = 0.4, Tax rate = 0.2
d. What happens to the multiplier as a country imports a larger proportion of its income?