Use the information to calculate the investment multiplier for a 3 sector economy.?

Marginal propensity to save = 0.46


Tax rate = 0.11


Marginal propensity to import = 0.15|||Here is the formula





DY/DI = 1 / [1-c(1-t)+m]





DY: change in Y


DI: change in I


DY/DI ratio gives the investment multiplier. Derivation follows from the definition





c: marginal propensity to consume which is (1-0.46)=0.54


t=0.11


m=0.15 marginal propensity to import





simply plus in the numbers to get 1.493875