Question : Which of the following statement are true?

The minimum value of multiplier can be zero and the maximum value of multiplier can be infinity.

Multiplier is a forward-looking function. Increase in income by a number of times due to a single increase in investment.

Option 1: Both are true.

Option 2: Both are false.

Option 3: Statement 1 is true, statement 2 is false.

Option 4: Statement 1 is false, statement 2 is true.

Question

Question : Which of the following statement are true?

The minimum value of multiplier can be zero and the maximum value of multiplier can be infinity.
Multiplier is a forward-looking function. Increase in income by a number of times due to a single increase in investment.

Option 1: Both are true.

Option 2: Both are false.

Option 3: Statement 1 is true, statement 2 is false.

Option 4: Statement 1 is false, statement 2 is true.

Team Careers360 · Accepted Answer

Correct Answer: Both are true.

Solution : The minimum value of multiplier can be zero and the maximum value of multiplier can be infinity.
Multiplier is a forward-looking function. Increase in income by a number of times due to a single increase in investment.
Hence, Option A is correct.

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Question : Which of the following statemenst are true?

If MPC and MPS are equal, the value of multiplier is 2.

If investment multiplier is 1, the value of MPC is zero.

Question : Which of the following statement are true?

In a two sector economy, if consumption is equal to income, average propensity to save will be zero.

In a two sector economy if income is zero consumption will also be zero.

Question : Which of the following statement are true?

Expenditure on scholarship is a capital expenditure.

Subsidies is a revenue expenditure

Question : Which of the following statement are true?

APC can be more than one.

APC+APS =1 always.

Question : Which of the following statement are true?

Corporate tax is revenue receipts.

Tax receipt is a capital receipt