As a result of increase in investment by र125 crores, national ineeme increases by र 500 crores. Calculate MPC.

straight K space equals space fraction numerator increment straight Y over denominator increment straight I end fraction space equals space 500 over 125 space equals space 4 straight K space equals space fraction numerator 1 over denominator 1 minus MPC end fraction space space space or space space space space 4 space equals space fraction numerator 1 over denominator 1 minus MPC end fraction space space or space space 4 minus 4 space MPC space equals space 1

4 space MPC space equals space 3 space left parenthesis equals space 4 space minus space 1 right parenthesis space or space space MPC space equals space 3 over 4 space equals space 0.75

80 Views

Determination of Income and Employment

Hope you found this question and answer to be good. Find many more questions on Determination of Income and Employment with answers for your assignments and practice.

Introductory Macroeconomics

Browse through more topics from Introductory Macroeconomics for questions and snapshot.