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Derive the tax multiplier

      

Derive the tax multiplier

  

Answers


Dana
Y = a + ß (Y-T) + I + G
Y = a + ßY – ßT + I + G
Y – ßY = a - ßT + I + G
(1 – ß) Y = a - ßT + I + G
Y = 1/ (1 – ß) * a - ßT + I + G
?Y/?T = - ß/ (1 – ß)

Dana05 answered the question on July 18, 2019 at 19:59


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