Advertisements
Advertisements
प्रश्न
Distinguish between Average propensity to consume and Marginal propensity to consume.
उत्तर
Average propensity to consume and Marginal propensity to consume.
| Basis of difference | Average propensity to consume | Marginal propensity to consume |
| Meaning | It shows the ratio of consumption expenditure to the level of income | It refers to the ratio of change in the consumption expenditure to the change in the disposable income |
| Formula | `APC=C/Y` | `MPC=(ΔC)/(ΔY)` |
APPEARS IN
संबंधित प्रश्न
An economy is in equilibrium. Calculate Marginal Propensity to Consume :
National income = 1000
Autonomous consumption expenditure = 200
Investment expenditure = 100
Find equilibrium national income:
Autonomous consumption expenditure = 120
Marginal propensity to consume = 0.9
Investment expenditure = 1100
An economy is in equilibrium. Find investment expenditure:
National Income =1,000
Autonomous Consumption =100
Marginal propensity to consume =0.8
An economy is in equilibrium. Find autonomous consumption expenditure:
National Income =1,600
Investment Expenditure = 300
Marginal Propensity to Consume= 0.8
The value of marginal propensity to consume is 0.6 and initial income in the economy is Rs 100 crores. Prepare a schedule showing Income, Consumption and Saving. Also show the equilibrium level of income by assuming autonomous investment of Rs 80 crores.
An economy is in equilibrium. From the following data about an economy calculate autonomous consumption.
1) Income = 500
2) Marginal propensity to save = 0.2
3) Investment expenditure = 800
Assuming that increase in investment is Rs1000 crore and marginal propensity to consume is 0.9, explain the working of the multiplier.
An economy is in equilibrium. From the following data about an economy, calculate investment expenditure:
1) Income = 10000
2) Marginal propensity to consume = 0.9
3) Autonomous consumption = 100
Assuming that increase in investment is Rs. 800 crore and marginal propensity to consume is 0.8, explain the working of multiplier
An economy is in equilibrium. Find 'autonomous consumption' from the following:
National income = 1000
Marginal propensity to consume = 0.8
Investment expenditure = 100
An economy is in equilibrium. Calculate the Marginal Propensity to Save from the following:
National Income = 1000
Autonomous Consumption = 100
Investment = 120
An economy is in equilibrium. Calculate the National Income from the following :
Autonomous Consumption = 120
Marginal Propensity to Save = 0.2
Investment Expenditure = 150
An economy is in equilibrium. Calculate Autonomous Consumption from the following :
National Income = 1,250
Marginal Propensity to Save = 0.2
Investment Expenditure = 150
An economy is in equilibrium. Find the Investment Expenditure from the following :
National Income = 750
Autonomous Consumption = 200
Marginal Propensity to Save = 0.4
Write explanatory answer
State and explain J.M. Keynes's ‘psychological law of consumption’.
Distinguish between :
Propensity to consume and Propensity to save.
Fill in the blank with appropriate alternatives given in the bracket:
The part of income not spent is________.
Give reasons or explain the following statement:
Income which is not saved is consumption.
Explain the following concepts or give definitions.
Consumption
State whether the following statements are True or False with reasons:
Increase in consumption expenditure is less than increase in income.
Answer in brief.
Explain the relationship between Income and Consumption.
Choose the correct answer :
When income increases consumption and saving will _________.
Write answers in ‘one’ or ‘two’ paras each :
Explain the concept of saving function.
Write short note on:
Paradox of value
Define or explain the following concept
Marginal Cost.
Answer the following question.
In an economy, investment increased by 1,100 and as a result of it income increased by 5,500. Had the marginal propensity to save been 25 percent, what would have been the increase in income?
What will be APC when APS = 0?
If the income is ₹ 400 crores and consumption is ₹ 250 crores, what will be the APC?
MPC = MPS = ?
Which one is correct?
Which of the following is correct?
Complete the following schedule -
| Y | C | APC | MPC |
| 100 | 90 | ? | ? |
| 120 | 108 | ? | ? |
______ buy goods and services for consumption and also supply factors of production.
A firm is able to sell any quantity of a good at a given price. The firm's Marginal Revenue will be ______
What is "MPS" or the 'marginal propensity' to save?
Why public goods must be provided by the government?
Identify the correct pair of from the following Columns I and II:
| Columns I | Columns II |
| 1. Total Product increases at an increasing rate and Marginal Product rises till it reaches its maximum point. | (a) Second Stage |
| 2. Total product increases at a decreasing rate and reaches maximum, and MP becomes zero. | (b) First Stage |
| 3. Total product also decreases and marginal product (MP) becomes negative. | (c) Third Stage |
| 4. Improvement in technique of production and discovery of fixed factor substitute can postpone the operation of law for some time. | (d) Fourth Stage |
What is saving per Income called?
If the value of Average Propensity to Save (APS) is 0.2 and National Income is ₹4,000 crores, then consumption will be ______
If MPS = 0, the value of multiplier will be ______
If the value of Average Propensity to Consume (APC) is 0.8 and National Income is ₹4,000 crores, the value of savings will be ______.
The marginal physical product of a factor must be ______ when the total physical product is falling.
Identify the correctly matched pair from Column A to that of Column B:
| Column A | Column B | ||
| (1) | MPC | (a) | Ratio of Savings to Consumption |
| (2) | APC | (b) | Ratio of Consumption to Income |
| (3) | APS | (c) | Ratio of Consumption to Savings |
| (4) | MPS | (d) | Ratio of Savings to Investment |
Income rises from ₹50,000 to ₹60,000, consumption increases from ₹40,000 to ₹48,000. In this situation, what will be the value of Marginal Propensity to Consume (MPC)?
If in an economy, the value of investment multiplier is 4 and Autonomous Consumption is ₹ 30 Crore, the relevant consumption function would be :
If increase in National Income is equal to increase in consumption, identity the value of Marginal Propensity to Save:
Assertion (A): Saving curve makes a negative intercept on the vertical axis at zero level of income.
Reason (R): Saving function refers to the functional relationship between saving and income.
If increase in National Income is equal to increase in Savings, the value of Marginal Propensity to Consume would be ______.
What is meant by autonomous consumption expenditure? Show it on a diagram.
When National Income rises from ₹ 600 Cr. to ₹ 1000 Cr., the consumption expenditure increases from ₹ 500 Cr. to ₹ 800 Cr. Calculate MPC and hence the value of Investment Multiplier.
APC can be greater than one, but MPC is always less than one. Give a reason to justify this phenomenon.
