CBSE 2015 Class 12 Economics Outside Delhi Set-1

Test Index

CBSE 2015 Class 12 Economics Outside Delhi Set-1

Question : 2

Total: 18

If MPC=1, the value of multiplier is : (choose the correct alternative)

0
1
Between 0 and 1
Infinity

Solution:

The value of multiplier is ‌

1−MPC

.
Here, MPC
refers to the Marginal propensity to consume.
As we are given the value of MPC as 1 . Thus, the value of multiplier becomes infinity.
Hence, the correct answer is option (d).

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