In economy, investment increaseRS 1,000 crore and marginal propensity – InterviewSolution

1.

In economy, investment increaseRS 1,000 crore and marginal propensity to save is 0.25 (i) investment(k) (ii) total increase in income(∆Y)

Answer»

EXPLANATION:

K = change in INCOME/ change in investment

k 1/MPS

k=1/.25

k=4

k= increase in income/1000

4*1000= increase in income

4000= increase in income

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