If MPC $= 0$ , the value of multiplier is (Choose the correct alternative)

0

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1

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Between

0

and

1

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Infinity

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Solution

The correct option is B $1$
Answer B)
The value of multiplier = 1/1-MPC
Where
MPC =Marginal Propensity to consume
given that
MPC= 0 then 1/1-0=1/1=1
Thus , the value of multiplier becomes 1

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