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CBSE 2016 Class 12 Economics Delhi Set-1

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Question : 9 of 18
Marks: +1, -0
In an economy investment is increased by ₹300 crore. If marginal propensity to consume is 2∕3 , calculate increase in national income.
Solution:  
‌ MPC ‌‌=2∕3
∆I‌=₹300‌ crores ‌
k‌=[1÷(1−MPC)]
‌=[1÷(1−‌
2
3
)]
‌
1
1−MPC
‌=‌
1
1−‌
2
3

‌
1
1
3
‌=3
k‌=‌
∆Y
∆I

3‌=‌
∆Y
300

∆Y‌=300×3
‌=₹900‌ crore ‌
Increase in national income is ₹900 crore.
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