Question : Using the consumption function, Calculate consumption at income level of 2500 crore, if autonomous consumption is 100 crore and 40% of additional income is consumed.
Option 1: 1000
Option 2: 1100
Option 3: 900
Option 4: 800
Answer (1)
21st Jan, 2024
Correct Answer: 1100
Solution : MPC= 0.4
C= 100+0.4(2500)
C= 1100
Hence, Option B is correct.
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