Answer to Question #63796 in Macroeconomics for Thanos
Question #63796
In Goa, India, the multiplier effect of iron ore exports is calculated to be 1.62.Vidyut Kumar Ta, “Iron Ore Mining Gives Impetus to Goa’s Economy,” Times of India, April 30, 2003. Calculate the impact of an additional 1,000 rupees of iron ore exports on the economy of Goa.
Expert's answer
Δ (real GDP demanded at each price level)=multiplier×initial Δ (component of AD)
Δ (real GDP demanded at each price level)=1.62 × 1,000 = 162 rupees
Δ (real GDP demanded at each price level)=1.62 × 1,000 = 162 rupees
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#198584 on Mar 2018
#198584 on Mar 2018 
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