Multiplier being 5 times, an incremental investment of ₹100 crores leads to an incremental income of : -
Answer & explanation
Correct answer: option 4
The correct answer is option (4) : ₹500 crores
The multiplier effect can be calculated using the formula :
Incremental Income = Multiplier * Incremental Investment
Given a multiplier of 5 times and an incremental investment of ₹100 crores :
Incremental Income = 5 * 100 = 500 crores
Therefore, the correct answer is : ₹500 crores