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    differences between the multiplier model and the AS/AD model

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    What are the differences between the multiplier model and the AS/AD model?

    © BrainMass Inc. brainmass.com October 9, 2019, 3:54 pm ad1c9bdddf
    https://brainmass.com/economics/unemployment/differences-multiplier-model--asad-model-17030

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    The multiplier was a concept developed by Keynes that states that any increase in injections into the economy (investment, government expenditure or exports) would lead to a proportionally bigger increase in National Income. This is because the extra spending would have knock-on effects creating in turn even greater spending. The size of the multiplier would depend on the level of leakages.

    http://www.theshortrun.com/classroom/doctrines/multiplier.html

    THE AS/AD model is an ...

    Solution Summary

    Differences between the multiplier model and the AS/AD model are explored.

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