For C = 40 + 0.8y ; the value of multiplier is :

5 10 15 20

5

The correct answer is option (1) : 5 The multiplier (k) is calculated using the formula : $k=\frac{1}{1-MPC}$ where MPC is the marginal propensity to consume. In the given consumption function C = 40 + 0.8y, the marginal propensity to consume (MPC) is 0.8. $k= \frac{1}{1-0.8}=\frac{1}{0.2}= 5 $