Question : In an economy, marginal propensity to consume is 0.80. If investment expenditure is increased by Rs.400 crore, calculate the total increase in income.
Option 1: 1000
Option 2: 2000
Option 3: 1400
Option 4: 1600
Correct Answer: 2000
Solution :
Question : An increase in investment by Rs. 400 leads to increase in national income by Rs. 2000 crore. Calculate marginal propensity to consume.
Question : In an economy, the marginal propensity to consume is 0.75. If the investment increases by Rs.2000 crore, calculate the total increase in income.
Question : An increase in investment by Rs.200 leads to increase in national income by Rs.1400 crore. Calculate marginal propensity to consume.
Question : An increase in investment by Rs.500 leads to increase in national income by Rs.2000 crore. Calculate marginal propensity to consume.
Question : In an economy, investment has increased by Rs.250 crore. If marginal propensity to consume is 3/5, calculate increase in national income.
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