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3.2 Multipliers

Part of National Income and Price Determination in AP® Macroeconomics. Read the opening section, then create a free account for the full interactive lesson, practice, and progress tracking.

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Multipliers

Economic multipliers measure how changes in spending or taxation influence the overall economy. They help us understand how initial changes in economic activity can lead to larger changes in aggregate output and income. To understand these multipliers, it’s essential to grasp the concepts of the marginal propensity to consume (MPC) and the marginal propensity to save (MPS), as they underpin the mechanics of these multipliers.

In this unit

9 lessons

  1. 3.1Aggregate Demand (AD)Preview lesson
  2. 3.2MultipliersThis lesson
  3. 3.3Short-Run Aggregate Supply (SRAS)Preview lesson
  4. 3.4Long-Run Aggregate Supply (LRAS)Preview lesson
  5. 3.5Equilibrium in the AD–AS ModelPreview lesson
  6. 3.6Changes in the AD-AS ModelPreview lesson
  7. 3.7Long-Run Self-AdjustmentPreview lesson
  8. 3.8Fiscal PolicyPreview lesson
  9. 3.9Automatic StabilizersPreview lesson

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