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We can comprehend this by looking at the multiplier mechanism, which is elucidated below : The manufacturing of final commodities employs factors such as capital, labour, land and entrepreneurship. In the absence of indirect taxes or subsidies, the total value of the final commodities output is allocated among distinct factors of manufacturing – interest to capital, rent to land, wages to labour etc.

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Hannah Pope

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3y ago
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Q: What is multiplier mechanism?
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