The formula for the investment multiplier (k) is:

CA Foundation · Business Economics · MTP · January 2026
The formula for the investment multiplier (k) is:
(A) A. 1/MPC
(B) B. 1/APS
(C) C. 1/(1 - MPC)
(D) D. 1 / (1 + MPC)

Suggested Answer and Working Notes:

Correct Answer: Option (C)

C. 1/(1 - MPC)

Topics: Determination of National Income

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