What you’ll learn3 learning objectivesChoose one objective for a focused lesson, or study the complete topic.9.1.1Multiplier process• The multiplier process:- definition of the multiplier- formulae for and calculation of multiplier in a closed and open economy, with and without a government sector- calculation of:- average and marginal propensities to save (aps and mps)- average and marginal propensities to consume (apc and mpc)- average and marginal propensities to import (apm and mpm)- average and marginal rates of tax (art and mrt)- national income determination using AD and income approach with the multiplier process- calculation of effect of changing AD on national income using the multiplierSyllabus objective9.1.2AD components and determinants• Components of Aggregate Demand (AD) and their determinants:- consumption function: autonomous and induced consumer expenditure- savings function: autonomous and induced savings- autonomous and induced investment; the accelerator- government spending- net exports (exports minus imports)Syllabus objective9.1.3National income gaps• Full employment level of national income and equilibrium level of national income:- inflationary and deflationary gapsSyllabus objective