CBSE Class 12 Economics sample paper 2026-27: question 10
From the official CBSE sample question paper for 2026-27, section A, question 10, for 1 mark. Try it first; the hints and our step-by-step solution are below.
Q10 · 1 mark · MCQDetermination of Income and Employment
The value of investment multiplier ranges between ______ and ________. (Choose the correct option to fill up the blank)
- (A)0,1
- (B)-1, 1
- (C)1, infinity
- (D)0, infinity
Source: official sample paper from cbseacademic.nic.in (PDF). See it in the full Sample paper 2026-27.
Hints
Open one hint at a time and try again before the next.
Hint 1
Find K when MPC = 0 and when MPC = 1.
Hint 2
K = 1/MPS.
Step-by-step solution
Each step shows the marks it earns, as an examiner would award them. Checked by an independent re-solve from the question paper.
K = 1/(1 − MPC), and MPC lies between 0 and 1.
- 1 mark
When MPC = 0, K = 1; as MPC approaches 1, K approaches infinity. So K lies between 1 and infinity. Option (C).
Answer: (C) 1, infinity
Where the marks are
- K = 1/(1 − MPC) with 0 ≤ MPC ≤ 1 (1 mark)
Revise the chapter
- Chapter: Determination of Income and Employment (notes, formulas, where marks are lost and every past question)
- Topic: Investment Multiplier
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