1. The multiplier is 5 (1/1-0.8) this is then multiplied by 50 (10^8) this would increase the overall RGDP by $250 billion instead of only $50 billion because once the 50 is invested, 80% is spent somewhere else and %20 is saved.
2. If DI is stable how does consumption change?
Consumption changes when disposable income stays constant when expectations change. For example if the aggregate price level rises then consumption will decrease because every dollar has less value than before.
