If the multiplier is 2 and the investment function is: I=200. What is the value of the marginal propensity to consume?

The marginal propensity to consume (MPC) can be calculated using the formula for the multiplier, which is 1/(1-MPC). Given that the multiplier is 2, we can set up the equation as follows:

2 = 1/(1-MPC)

To solve for MPC, we first subtract 1 from both sides:

2 - 1 = 1/(1-MPC) - 1

This simplifies to:

1 = 1/(1-MPC) - 1

Next, we add 1 to both sides:

1 + 1 = 1/(1-MPC)

This simplifies to:

2 = 1/(1-MPC)

To solve for (1-MPC), we take the reciprocal of both sides:

1/2 = 1-MPC

This simplifies to:

0.5 = 1-MPC

Finally, to solve for MPC, we subtract 0.5 from 1:

MPC = 1 - 0.5

So, the marginal propensity to consume (MPC) is 0.5.