If you study maths at A-level you can see the multiplier effect is a derived equation from a sum of a geometric series to infinity as the the common ratio in this case is the marginal propensity to consume. Thus the total amount of money at the end can be formed by the equate a/1-r and in this case is it is starting at 100% so a=1
i know Im asking the wrong place but does anybody know of a method to log back into an Instagram account?? I was dumb lost the account password. I love any tips you can offer me!
@Yehuda Watson I really appreciate your reply. I got to the site on google and I'm waiting for the hacking stuff atm. Takes quite some time so I will reply here later with my results.
This is the 2nd of your videos my uni has directed me to. Any confusion I have after reading text vanishes after watching these teaching videos. Excellent¡!
Thanks from a german economics student for the easy-to-understand explanations. However you may could have taken more time to explain the accelerator effect rather than the multiplier effect (besides you could have talked about the multiplier effect on tax increase/decrease which would be slightly different: MPC/(1-MPC)). The accelerator effect is pointing out the fact that companies trying to hit a moving target while trying to build up a higher capital stock in order to meet an increased demand. The reason for that is that by investing their money, they increase the AD themself. Followed by further need to build up a higher captial stock and so on... Short: To meet a demand of 1 MU you need to invest >1 MU. All in all: The MAM (Multiplier-Accelerator-Principle) states that, deffered consumer behavior (Ct = C0 + cYt-1) and deducted investitons (based on higher demand) lead to fluctuation. best regards
The information regarding overall everyday functions of society and how business determines everyone way is beyond intriguing. for me I internalize the sensitive nature of our buy, sale and trade world however these lectures has provided intense definition which will only compel my interest to advance in the business sector as I seek to establish my legacy.
The Keynesian LRAS will show RGDP increasing and decreasing depending on where you draw the SRAS, whereas the classical LRAS won’t because any shift on the LRAS is just inflationary or deflationary as the productive productive has been achieved.
@@eliopalombi basically whenever the current state of the economy is involved in the answer. e.g. if economy is near/at full capacity at yf an increase in AD will just be translated into demand pull inflation as price rises and output stays constant at yf.
The multiplier effect should also depend on the curvature/slope of the supply curve i.e indirectly on the potential economic growth at that point of time.
I'm quite confused at the accelerator effect. What I don't understand is what the makes firms invest in the first place? Do they expect rise in the rate of GDP growth? And vice versa, how would the rate of GDP growth increase when firms are not investing? Would that be in the hands of other factors (such as reductions in corporate tax or income tax etc)? Great video however. So much better than my lessons in college.
I have a macro economic policy course tomorrow morning, and I'm confused as to how you calculated the multiplier effect. You're using 1/(1-MPC), could you not use 1/reserve ratio?
+Paul G No this isn't wrong, no where in the video has the price level been mentioned to be a determining factor of the multiplier. The multiplier works independent of the price level using the process mentioned in the video
7yrs later, this info is still valuable 👏
It’s not like the economics changes over time big man
@@AJ5711 last minute paper 3 revision?
@@henaz3646 ofc 😭😭 u too?
@@AJ5711 yeah it was haha
87
8 years on and ur still so helpful
Exam in 20 minutes. This will be my last economics exam. Thank you for this beautiful year Mr. Dal❤
Micro doesnt need this though
skibdi gyatt
If you study maths at A-level you can see the multiplier effect is a derived equation from a sum of a geometric series to infinity as the the common ratio in this case is the marginal propensity to consume. Thus the total amount of money at the end can be formed by the equate a/1-r and in this case is it is starting at 100% so a=1
I saw the formula and thought: Geometric series
i know Im asking the wrong place but does anybody know of a method to log back into an Instagram account??
I was dumb lost the account password. I love any tips you can offer me!
@Angel Sonny instablaster ;)
@Yehuda Watson I really appreciate your reply. I got to the site on google and I'm waiting for the hacking stuff atm.
Takes quite some time so I will reply here later with my results.
@Yehuda Watson It worked and I actually got access to my account again. Im so happy!
Thank you so much, you saved my ass!
This makes soooo much sense now thank you :)
This is the 2nd of your videos my uni has directed me to. Any confusion I have after reading text vanishes after watching these teaching videos. Excellent¡!
Okay this is the easiest to understand video, thank you for speaking slowly and giving us coherent examples
Writing tomorrow and you've saved my life, sending love from the University of Cape Town in South Africa.
Thank you for your videos! They are really helping me through Economics, really appreciated
8:07 accelerator effect
yung sam thank you so much
thanks g
Thanks from a german economics student for the easy-to-understand explanations. However you may could have taken more time to explain the accelerator effect rather than the multiplier effect (besides you could have talked about the multiplier effect on tax increase/decrease which would be slightly different: MPC/(1-MPC)).
The accelerator effect is pointing out the fact that companies trying to hit a moving target while trying to build up a higher capital stock in order to meet an increased demand. The reason for that is that by investing their money, they increase the AD themself. Followed by further need to build up a higher captial stock and so on...
Short: To meet a demand of 1 MU you need to invest >1 MU.
All in all:
The MAM (Multiplier-Accelerator-Principle) states that, deffered consumer behavior (Ct = C0 + cYt-1) and deducted investitons (based on higher demand) lead to fluctuation.
best regards
You've explained these concepts so well! Thanks!
Ugh finally I got it! I have my cie final exams this may, and its funny that only now I've understood these concepts properly. Thank you
Same
Thank you vikstar
Cracking video buddy!!
Isn’t the MPC the marginal propensity to consume ?
marginal private cost
The information regarding overall everyday functions of society and how business determines everyone way is beyond intriguing. for me I internalize the sensitive nature of our buy, sale and trade world however these lectures has provided intense definition which will only compel my interest to advance in the business sector as I seek to establish my legacy.
Well done EconplusDal, a good explanation.
Your videos are so helpful! Thank you so much!
how do i know when too use classical or keynsian AD/AS diagram?
Opps this comment was posted 2 years ago
Tech Helper oof does anyone know the answer?
The Keynesian LRAS will show RGDP increasing and decreasing depending on where you draw the SRAS, whereas the classical LRAS won’t because any shift on the LRAS is just inflationary or deflationary as the productive productive has been achieved.
@@eliopalombi basically whenever the current state of the economy is involved in the answer. e.g. if economy is near/at full capacity at yf an increase in AD will just be translated into demand pull inflation as price rises and output stays constant at yf.
Your videos helped alot, thanks for making it so easy.......
bless this manTYSM
this man is the GOAT
The multiplier effect should also depend on the curvature/slope of the supply curve i.e indirectly on the potential economic growth at that point of time.
Awesome video, thank you!
thank you very much! very well explained! ^^
Thanks.. this lesson made me clear
very nice way of explaining..... Nice... love it
Love this explanation.
thank you so much for clearing these concepts. cheers to you!
Phenomenal Stuff! Thanks!
Excellent.
Still useful even to this day ❤
I'm quite confused at the accelerator effect.
What I don't understand is what the makes firms invest in the first place? Do they expect rise in the rate of GDP growth? And vice versa, how would the rate of GDP growth increase when firms are not investing? Would that be in the hands of other factors (such as reductions in corporate tax or income tax etc)?
Great video however. So much better than my lessons in college.
Ususally happens during a recovery, so AD is increasing. This increases business confidence, so therefore businesses will be more likely to invest
Thankyou Very useful
Thank you so so so much!
Legend 🙏🙏
WHAT Talking U ? LUB U !
Thanks alot sir!
thank you sir
That t-shirt is trippy
Thank you man ! :) pls keep doing what you are doing
great video thank you :)
You truly are a god
Best explanation thank you
No Keynes, no gains 💪
Really interesting video. Thank you.
thank youuuuuu
i love you man
9 hours im gonna speed run past papers and revision
Should they multiplier be shorter?
Thank you so much. God bless
thanks this was bugging me for days
i am your biggest fan
Nice explanation of multiplier but I think diagram should be different c+I+I' curve should b indicated to clarify the effect
Thank you
Appreciated
You look like a good guy
does the accelerator effect apply to both government and firm investment?
Thnx sir... thnx alot...
man like econplusdal!
pls explain balanced budget multiplier
why is the final change in national income not €400 million?
06:35 - Y1 plus £400m, not £500.
Could you demonstrate the multiplier effect with SRAS as well?
No classical economists dont believe in a multiplier effect since the economy is always operating at full capacity.
thanks.
3:23 thought he said gunman
What about the 45 degree Keynesian model?
why does imports decrease the MPC if we're spending?
you’re not spending on domestic goods they’re foreign
Thanks Vikk!! balle balle
within how long ? eternally
What is the Multiplier if the MPC =1?
infinity
In theory yes infinity but it’s never really because of taxes, importing, savings ext
top man
I have a macro economic policy course tomorrow morning, and I'm confused as to how you calculated the multiplier effect. You're using 1/(1-MPC), could you not use 1/reserve ratio?
Thats for the credit multiplier! For how banks increase money supply
I love you Krrish’s ❤️❤️😍😍😘😘
Anyone know how to actually use this concept ??
Whats the difference between National output and GDP?
its the same!! GDP is the measure of national output. An increase in GDP simply means an increase in (national) output
8:21 I do the same thing with my lips, I think its an economist thing.
I love you
Is this not in your year 2 macro book @mohammed Yousuf in the book?
Charlie Stone it’s AS macro year one
W dal
in 5:16 how did he get 0.8?
cause I’m pretty sure he said if someone for example earns income they spend 80% of it so 80/100=0.8
booga booga bonga bonga
How did you get 5
1/1-0.8=5. MPC is 80% so 1-0.8=0.2, so 1/0.2=5
Not him summarising and explaining and entire page of the spec (2.4 Edexcel) in just one 10 minute video!
Hi teacher, why does multiplier decrease when marginal propensity to import rises?
Increase in leakages(an outflow of money)- imports- reduces the money circulation in the economy hence reduces the multiplier effect
@@nidabawa4362 oh okay. Thanks!! U replied at right time hahaha. Cie A level eco test in 2 days!
@@oneinabillion654 same bro!! may we both get an A
@@nidabawa4362 I'm most worried for Eco P4 although I got 88% for AS lol
@@nidabawa4362 can I get ur WhatsApp so we can discuss. I have no one to discuss with lol
Siiiuuuu
whos basking in the knowledge of econplusdal in 2023!
I was expecting an explanation on the accelerator especially simple and flexible
Are you Jesus Christ?
THANK YOU
Thank you so much, my teacher didnt mąkę sense
Lol i m watching from india to pass my university exam 😂
Multiplicand
the is the big daddy
isn't this wrong? the price level should be constant for the multiplier to take effect
+Paul G No this isn't wrong, no where in the video has the price level been mentioned to be a determining factor of the multiplier. The multiplier works independent of the price level using the process mentioned in the video
+Paul G Wayyyy
+Paul G Shots fired and recieved
+Paul G kinda confused by what you even mean. in macro, price levels are usually the effects of demand/growth/multipliers, not a cause....i think, lol
Hard to understand the accent !!