From the following data calculate Investment Multiplier and Equilibrium…

CBSE Economics class 12 question and answer | From the following data calculate Investment Multiplier and Equilibrium level Income in the economy.

By
Komal Kohli
-
cbse

From the following data calculate Investment Multiplier and Equilibrium level Income in the economy.

(i) Change in initial investment (Al) = rs. 1,000 crore
(ii) Marginal Propensity to Save (MPS) = 0.5
(iii) Autonomous consumption (*) = rs. 50 crore
(iv) Planned investment = rs. 100 crore

Ans. the equilibrium level of income in the economy is Rs. 2,000 crore.

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