Question

What determines the size of the profit multiplier?

Answer 1

A profit multiplier can refer to a number of calculations in various contexts. One common use is to help determine the future value of a business. If you're ready to sell your business, you probably don't want to settle for the value of the assets and the net profit you made last year; you want a number that reflects the expected value the business will bring to the new owner.

the profit multiplier was determined by

Propensity to tax

Propensity to save

Propensity to import

Capital

Value enhancing and detaching variables.