Hello sir
Regarding the illustration you have given on multiplier effect in chapter 2,i dont understand how the customers have 19000 available for spending. Could you please explain it again?
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multiplier effect
10y ago#1The person who has put $10,000 in the bank is able to spend the money.
The person who borrowed $9,000 in the bank is also able to spend the amount borrowed.
Therefore between them they have $19,000 available to spend. (They obviously might not spend it - the person who put $10,000 in the bank might decide to leave it there - but it is available for spending.)
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