Determination of Income and Employment — Economics STD 12 Commerce — Question
CBSE BoardEnglish MediumSTD 12 CommerceEconomicsDetermination of Income and Employment1 Mark
Question
Given the consumption function C = 250 + 0.75Y, what will be the value of multiplier?
✓
Answer
Given the consumption function C = 250 + 0.75Y, in the given equation 0.75 is MPC and $\text{k}=\frac{1}{1-\text{MPC}}$$\therefore\frac{1}{1-0.75}=\frac{1}{0.25}=4$
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