Advertisements
Advertisements
प्रश्न
Define investment multiplier.
Advertisements
उत्तर
Investment multiplier or simply ‘multiplier’ implies that any change in the investment leads to a corresponding change in the income and output by multiple times. That is, in other words, the change in the income and output is more than (or multiple times) the change in investment. For example, if investment increases by 10%, then the corresponding increase in the income and output will be more than (let's say 30% or 40%) the increase in the investment. Algebraically, the investment multiplier is expressed as a ratio of the change in output to the change in investment.
APPEARS IN
संबंधित प्रश्न
Define multiplier
What is the relation between marginal propensity to consume and multiplier?
The value of the multiplier is: (choose the correct alternative)
a. `1/"MPC"`
b. `1/"MPS"`
c. `1/(1-"MPS")`
d. `1/(MPC- 1)`
If MPC = 0, the value of the multiplier is: (Choose the correct alternative)
a. 0
b. 1
c. Between 0 and 1
d. Infinity
Calculate the marginal propensity to consume if the value of multiplier is 4.
How is the investment multiplier related to marginal propensity to consume?
Explain the relationship between the investment multiplier and marginal propensity to consume.
Find the value of additional investment made by the government when MPC = 0.5 and the increase in income (ΔY) = ₹ 1000.
If in an economy :
Change in initial Investments (∆I) = ₹ 500 crores
Marginal Propensity to Save (MPS) = 0.2
Suppose in an economy, the initial deposits of ₹ 400 crores lead to the creation of total deposits worth ₹ 4000 crores.
Under the given situation the value of reserve requirements would be ____________.
Keynesian multiplier establishes a relationship between ______
Keynes derived Investment Multiplier from Kahn’s ______
The value of Keynesian Investment Multiplier depends on ______
Discuss the mechanism of investment multiplier with the help of a numerical.
Which of the following statements is true?
For a hypothetical economy, assuming there is an increase in the Marginal Propensity to Consume from 80% to 90% and change in investment to be ₹ 2000 crore.
Using the concept of investment multiplier, calculate the increase in income due to change in Marginal Propensity to Consume.
If a linear consumption curve takes a parallel shift downwards, the value of investment multiplier will ______.
Illustrate that the investment multiplier is inversely proportional to MPS.
