How much additional income is generated in an economy with additional investment of Rs 100 crore, and when MPC=\(\frac{ 1}{2 }\)?

100 crore 200 crore 300 crore 400 crore

200 crore

Change in income = k (multiplier ) * Change in investment expenditure K= \(\frac{ 1}{ \text 1- MPC}\) k= \(\frac{1 }{\text 1 - 0.5 }\) = 2 Change in income = 2 * 100 = 200