Option 1 -> If investment is 1000 crores, income generated = 2.5 × 1000 = 2500 crores (not 1000).
Option 2 -> If investment is 400 crores, income generated = 2.5 × 400 = 1000 crores (matches requirement).
Option 3 -> If investment is 100 crores, income generated = 2.5 × 100 = 250 crores (not 1000).
Option 4 -> If investment is 250 crores, income generated = 2.5 × 250 = 625 crores (not 1000).
Hence, Option 2: 400 crores -> Using the multiplier formula: Change in Income = Multiplier × Change in Investment. Rearranging: Change in Investment = Change in Income / Multiplier = 1000 / 2.5 = 400 crores. The multiplier effect shows that an initial investment of 400 crores will generate a total income of 1000 crores through successive rounds of spending in the economy. -> correct