If MPC is 0.9 and increase in investment is of र 100 crores, find out increase in national income.

Solution

straight K space equals space fraction numerator 1 over denominator 1 minus MPC end fraction space equals space fraction numerator 1 over denominator 1 minus 0.9 end fraction space equals space fraction numerator 1 over denominator 0.1 end fraction space equals space fraction numerator 1 over denominator 1 divided by 10 end fraction space equals space 10 space crores

Increase in national income = 100 x 10 = 1,000 crores.

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