CBSE 2016 Class 12 Economics Delhi Set-1

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Question : 9
Total: 18
In an economy investment is increased by 300 crore. If marginal propensity to consume is 23 , calculate increase in national income.
Solution:  
MPC =23
I=300 crores
k=[1÷(1MPC)]
=[1÷(1
2
3
)
]

1
1MPC
=
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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