Multiplier k=MPS1
k=0.201=5
Change in Income =k×ΔInvestment
=5×400
=Rs. 2000 Crores
Therefore, the total increase in income is Rs. 2000 Crores.
CUET UG 2022 — Economics Macro
In an economy MPS=0.20 and investment is increased by Rs. 400 crores, than total increase in income is _____ Crores.
Verified 13 Jul 2026.
Rs. 2000
Rs. 2500
Rs. 2700
Rs. 3,200
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