CUET Preparation Today
When the marginal propensity to consume is given as 0.5, what is the tax multiplier? |
2 -2 3 -1 |
-1 |
The correct answer is Option (4) → -1 MPC (Marginal Propensity to Consume) = 0.5 Tax Multiplier= [−MPC / (1-MPC)] = - 0.5 / (1-0.5) = - 0.5 / 0.5 = -1 |
