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HomeCXC CAPE EconomicsThe circular flow and multiplier
CXC CAPE · · Economics

The circular flow and multiplier
Practice Questions

40 CXC CAPE Economics questions on The circular flow and multiplier, each with instant feedback and a full examiner-style mark scheme.

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✨ Revision guide includes key terms, worked examples and exam technique for The circular flow and multiplier.

Try 2 sample questions on The circular flow and multiplier

Question 1 · 1 mark · Difficulty 1/3

Which formula gives the multiplier?

  1. MPC ÷ (1 − MPC)
  2. 1 − MPC
  3. 1 ÷ MPC
  4. 1 ÷ (1 − MPC)
Show answer & explanation
✓ Answer: D1 ÷ (1 − MPC)
Award 1 mark. The multiplier depends on what leaks from the flow, not on what is spent, which is why the denominator is the propensity to withdraw.
Question 2 · 1 mark · Difficulty 1/3

What does the marginal propensity to withdraw consist of?

  1. The propensity to consume plus the propensity to save
  2. The propensity to save alone
  3. The propensities to save, to tax and to import added together
  4. Investment, government spending and exports added together
Show answer & explanation
✓ Answer: CThe propensities to save, to tax and to import added together
Award 1 mark. Omitting the import propensity substantially overstates the multiplier in an open economy.
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20 questions · 25 min · free

CXC CAPE Economics: The circular flow and multiplier FAQ

Is Kramizo free for CXC CAPE students preparing for Economics?
Yes — completely free. Every student gets 45 questions a day on the free plan, with no card required and no trial countdown. That free quota works across every subject and every topic in our bank, so you can mix The circular flow and multiplier practice with other Economics topics or even switch to a totally different CXC CAPE subject without paying anything. Kramizo's optional Pro plan removes the daily cap and adds detailed progress analytics, but the free tier is the real product — used by thousands of GCSE, IGCSE and CSEC students.
Are the The circular flow and multiplier questions aligned to the official CXC CAPE Economics syllabus?
Every question is written against the published CXC CAPE Economics specification, including the exact command words (state, describe, explain, calculate, evaluate, etc.), mark allocations, and difficulty tier you'd see on a real CXC CAPE paper. Explanations are written in the style of official examiner mark schemes — they tell you what is being awarded marks and why distractors are wrong, not just whether you got it right. The bank is continually refined to match the latest syllabus updates from CXC CAPE.
How is The circular flow and multiplier typically tested on CXC CAPE Economics papers?
The circular flow and multiplier appears across multiple question types on real CXC CAPE Economics papers — most commonly as multiple-choice questions in the objective section, structured short-answer questions in the main paper, and occasionally as part of an extended response. Kramizo's practice bank reflects that mix: 4-option MCQs, true/false statements, fill-in-the-blank key terms, multi-select questions, and ordering questions. Working through the bank gives you exposure to every question style examiners actually use.

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