Multiplier for private closed economy
For private closed economy, the data of columns 1 & 2 of the below table is given. Determine multiplier in this example?
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Since each rise of $50 billion in GDP raise aggregate expenditures by $40 billion, the MPC is .8 and so the multiplier is 5.
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Describe the advantages and disadvantages of the aggressive working capital financing approach? An aggressive working capital financing approach generally results in a lower cost of funds for a firm however a higher level of risk.
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