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What is Keynesian Multiplier Model?

In an economics model, a multiplier is a number that quantifies the relationship between the change in one economic quantity and the change in another directly related economic quantity. For example, consider the simple deposit multiplier. This multiplier is part of the multiple deposit creation model of the banking system. The simple deposit multiplier is the number that describes the change in checkable deposits that would follow a change in banking reserves. This multiplier can be shown to have a reciprocal relationship to the reserve requirement for banks in the system. If the reserve requirement is 10%, the simple deposit multiplier is 10. If, for instance, the Federal Reserve increases reserves in the banking system by $100, then a multiplier of 10 implies deposits in the banking system will increase by $1000. The tenfold increase is called a multiplier effect. The term multiplier is also commonly associated with Keynesian economics. The Keynesian multiplier relates an increase in aggregate income to an increase in investment.

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  • Our lead Keynesian Multiplier Model Assignment Expert has a Ph.D. in Economics from a leading university in Brussels. She has been teaching at the London School of Economics for over five years and is very passionate about teaching. Her illustrious academic career along with her genuine interest to help students from across the world write their Keynesian Multiplier Model Assignment and Keynesian Multiplier Model Homework Essays.
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  • Currently working as a guest lecturer in universities across the US our next economics assignment writing expert has years of experience in writing Keynesian Multiplier Model Assignments and Keynesian Multiplier Model Homework essays for economics students pursuing their undergrad programs to students with more advanced requirements of dissertation and thesis writing. He has completed his Ph.D. in Political Economics from the Pennsylvania University.

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