Multiplier effects, based on Keynesian Fiscal policy

1) Define MPC(marginal propensity to consume) , MPS(marginal propensity to save), APC(average propensity to consume) and APS(average propensity to save). (2 points)

2) Define multiplier effects, based on Keynesian Fiscal policy. (2 points)

3) When economy falls into a recession, what kind of fiscal policy is needed? Give a specific tool of fiscal policy.(2 points)

4)Discuss the long run effects of “Crowding out” due to a short run expansionary fiscal Policy.(2 points)

5) If MPC is larger, is the Multiplier bigger or smaller? why? explain based on the formula. (2 points)