Fiscal Multipliers Debunked?

But if you try to add $1 to I in Y = kI

Y = kI + $1

Wait, if you add $1 to I then it becomes (I + $1), say Inew.

Then you have Y= kInew = k (I + $1) = kI + $k.

I am not sure whether you misspoke in the previous post, but you say “add $1 to I.” If you add something to a variable, this becomes the new value of the variable. Then, when you multiply, you distribute.

What you’re saying is akin to this:

F=ma

Let’s increase m by 1 kg.

But if you try to add 1kg to m in F=ma

F = ma + 1

And that’s where you go wrong. If you increase m by one, the new formula is F = (m + 1) *a

Which, in turn, distributes.

Am I misunderstanding you?