Answer :
An investment multiplier determines the financial impact of a public or private project on the economy.
Investment increases productive capacity that raises the level of output, employment and income. When investment increases by a certain amount, aggregate income increases by a multiple of that investment.This multiple is called investment multiplier.
MPC is the increase in the amount of consumption from the increase in the income of the person.
Multiplier=1/(1-MPC)
If MPC is high the value of multiplier will also be high.
Marginal propensity to save (MPS) refers to the proportion of any extra income that is saved by consumers.
MPS = 1-MPC
So if MPS increases then MPC decreases, and we know when MPC decreases then multiplier also decreases.
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