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If Mpc = 0, the Value of the Multiplier Is: (Choose the Correct Alternative) - Economics

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प्रश्न

If MPC = 0, the value of the multiplier is: (Choose the correct alternative)

a. 0
b. 1
c. Between 0 and 1
d. Infinity

उत्तर

1

We know that

Multiplier (k) = `1/(1- MPC) = 1/(1- c)`

`= 1/(1- 0) = 1`

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Investment Multiplier and Its Mechanism
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