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According to Keynes, if MPS = 1 then, in a closed system, MPC must be 0. The only alternative is to borrow - which defeats the purpose of saving all the marginal increase in income! Therefore, it is possible but most unlikely.

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Q: Can mps equal 1 and mpc equals 0?
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Relationship between MPC and multiplier?

Relationship if: MPC decreases, K (Multiplier) will be weaker MPC increases, K will be stronger MPC = o(zero), K = 1 MPC = 1, K= infinity in real life: K = more than 1 & less than infinity MPC = less than 1 & more than 0 Assumptions: K works better in a closed economy (no foreign trade) K works better in an economy which has not reached full employment level


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