'Investment multiplier and Marginal Propensity to Consume are directly related to each other.' Explain with the help of numerical example.

Investment multiplier (K) and Marginal Propensity to Consume (MPC) are directly related.Now, suppose the value of MPC = $\displaystyle 0$·$\displaystyle 6$Then, the value of $\displaystyle K = \frac{1}{1 - \text{MPC}} = \frac{1}{1 - 0\cdot 6} = \frac{1}{0\cdot 4} = 2.5$If the value of MPC changes from $\displaystyle 0.6$ to $\displaystyle 0.8$ then,the value of $\displaystyle K = \frac{1}{1 - 0\cdot 8} = \frac{1}{0\cdot 2} = 5$Thus, it is clear from illustration mentioned above that there exists direct relation between MPC and investment multiplier. As MPC increases the value of investment multiplier also increases.