How
On - In an economy, actual level of income is 1,000 whereas the full employment level of income is a bit
more than this. One - fourth of the income is saved in the economy. If there is an increase in investment in
the economy by 150 calculate 0 new income level at full employment level (in) change in savings (in)
change in consumption.
Answers
Explanation:
In S = – a + (1 – b) Y, ‘a’ denotes (1)
Automatic consumption expenditure
Annual consumption expenditure
Autonomous savings.
Consumption expenditure
MPC = 1 – MPS. It is (1)
None of these
True.
Depends on their values
False.
If MPC is less than one, it follows that (1)
(1-b) i.e. MPS is zero
(1-b) i.e. MPS is positive
(1-b) i.e. MPS is negative
(1-b) i.e. MPS is infinity
The formula of investment multiplier in terms of MPS is (1)
ΔCΔD
1MPS
CΔI
CY
Why should price rise only after full employment? (1)
If planned saving are greater than planned investments, what will be its effect on inventories? (1)
What is full employment? (1)
Categorise the following as induced investment and autonomous investment. (1)
Government has set up public health centres in rural areas.
Government has decided to invest Rs. 1,000 crore to save Sunder ban Forests.
Airtel has invested ? 1,000 crore to improve its services.