--%>
Assignment Help - homework help

Total increase in national income

In an economy the MPC is 0.75. Investment expenses in the economy raise by Rs.75 crore. Compute total increase in national income.

E

Expert

Verified

K = DY/DI = 1/1-MPC
DY = DIx1/1-MPC
= 75x1/1-0.75
= 300 Crore

   Related Questions in Microeconomics

  • Q : Interest rates on financial instruments

    Interest rates on specified financial instruments tend to be lower the: (1) shorter the period to maturity. (2) greater the risk of default. (3) less liquid is the asset. (4) greater the expected rate of inflation. (5) greater the face value is relati

    		•
  • Q : When are average and outputs prices of

    Average and Outputs prices for CDs and DVDs both rose throughout 1999 to 2000 (before the start of Napster and subsequent file-sharing software), which implying: (1) supply of prerecorded music should have grown. (2) law of demand doesn’t apply

    		•
  • Q : Sign of Lorenz Curves The Lorenz curve

    The Lorenz curve gives an indication of: (w) the poverty rate. (x) dead end poverty. (y) relative poverty. (z) post-transfer poverty. Can someone explain/help me with best solution about problem of Economic

    		•
  • Q : Marginal tax rate on earn income The

    The marginal tax rate onto earned income in the negative income tax system demonstrated in this figure is: (1) 15 percent. (2) 20 percent. (3) 25 percent. (4) 33.3 percent. (5) 50 percent.

  • Q : What will happen when a supply of curve

    When a supply curve is positively sloped, a raise in demand will increase the equilibrium price as well as: (w) raise the quantity supplied. (x) raise supply. (y) decrease the quantity supplied. (z) decrease supply.

    		•
  • Q : Price of elastic demand for raises

    When decreasing ticket prices for Usher concerts raises total revenues, in that case the demand for tickets for Usher concerts: (1) perfectly price elastic. (2) relatively price elastic. (3) unitarily price elastic. (4) relatively pri

    		•
  • Q : Advantage of a partnership over

    Can someone help me in finding out the right answer from the given options. One of the advantages of a partnership over proprietorship is: (i) In a partnership just one partner is liable for the debt. (ii) Partnerships permit for more specialization in the management.

    		•
  • Q : Calculating Present Value by Interest

    When all bonds are perpetuities which annually pay $1000 (the sum of one thousand and 00/100 dollars) per annum, at an interest rate of 10 percent, the price of these bonds is: (1) $4000. (2) $5000. (3) $6250. (4) $8000. (5) $10,000.<

    		•
  • Q : Difference between Collusive and

    Difference between collusive and non-collusive oligopoly. Elucidate how oligopoly firms are interdependent in taking price and output decisions.

    		•
  • Q : Perfectly demand elasticity On a

    On a horizontal demand curve, there: (w) demand is perfectly elastic. (x) demand is perfectly inelastic. (y) the elasticity of demand varies. (z) demand is unitarily elastic. Can someone explain/help me with best s

    		•