GraphIt
.now
/
Subjects
Tutorial
About
Contact
/
Economics
/
Keynesian Cross
/
Advanced Editor
📈 Economics
← Standard view
Scale Graph to Fit Data
Copy
PNG ↓
Labels
Graph title
X-axis label
Y-axis label
Axis Bounds
X-Axis
to
Y-Axis
to
Apply
Parameters
Autonomous Spending (A)
Marginal Propensity to Consume (MPC)
Change in Govt Spending (ΔG)
Key Concepts
• Equilibrium where AE line crosses 45° line: AE = Y
• Y* = Autonomous spending / (1 − MPC) — the multiplier formula
•
Multiplier
= 1/(1−MPC): a higher MPC → larger multiplier
• A rise in government spending shifts the AE line up → multiplied rise in Y*
• Leakages (savings, taxes, imports) reduce the multiplier effect
Legend
Show Legend
Yes
No
Size
10