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प्रश्न
Distinguish between :
Propensity to consume and Propensity to save.
उत्तर
| Basis of Difference | Propensity to consume | Propensity to save |
| Also known as | Consumption function | Savings function |
| Defines | Relationship between income and consumption | Relationship between income and saving |
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संबंधित प्रश्न
............... consumption can not be zero.
(Induced / Autonomous / Government / Private)
Define marginal propensity to consume
Calculate investment expenditure from the following data about an economy which is in equilibrium:
National income = 1000
Marginal propensity to save = 0.25
Autonomous consumption expenditure = 200
Complete the following table:-
| Income (Rs) | Consumption expenditure (Rs) | Marginal propensity to save | Average propensity to save |
| 0 | 80 | ||
| 100 | 140 | 0.4 | ....... |
| 200 | ........ | ...... | 0 |
| ....... | 240 | ........ | 0.20 |
| ......... | 260 | 0.8 | 0.35 |
An economy is in equilibrium. Calculate Marginal Propensity to Consume :
National income = 1000
Autonomous consumption expenditure = 200
Investment expenditure = 100
In an economy an increase in investment by Rs 100 crore led to ‘increase’ in national by Rs 1000 crore. Find marginal propensity to consume.
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.
Assuming that increase in investment is Rs1000 crore and marginal propensity to consume is 0.9, explain the working of the multiplier.
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 Marginal Propensity to Consume from the following:
National income = 2000
Autonomous consumption = 400
Investment expenditure = 200
An economy is in equilibrium. Calculate the Investment Expenditure from the following
National Income = 800
Marginal propensity to save = 0.3
Autonomous Consumption = 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
Explain the Keynesian psychological law of consumption.
Complete the following table:
|
Consumption expenditure (Rs) |
Savings (Rs) |
Income (Rs) |
Marginal propensity to Consume |
|
100 |
50 |
150 |
|
|
175 |
75 |
……. |
…… |
|
250 |
100 |
……. |
…… |
|
325 |
125 |
……. |
…… |
Answer the following question :
Explain the types of investment expenditure.
Answer the following question :
Explain the development and non-development expenditures of government .
Write explanatory answer
State and explain J.M. Keynes's ‘psychological law of consumption’.
Write explanatory answer:
Explain the subjective and objective factors determining consumption function.
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.
Define or explain the following concept
Marginal Cost.
Answer the following question.
State the objective factors determining consumption function.
Answer the following question.
What is meant by a propensity to consume?
Suppose in a hypothetical economy, the income rises from ₹ 5,000 crores to ₹ 6,000 crores. As a result, the consumption expenditure rises from ₹ 4,000 crores to ₹ 4,600 crores. Marginal propensity to consume in such a case would be __________.
In a hypothetical economy, Mr. Neeraj has deposited ₹100 in the bank. If it is assumed that there is no other currency circulation in the economy, then the total money supply in the economy will be ____________.
Which of the following is correct?
Calculate equilibrium level of income for a hypothetical economy, for which it is given that:
- Autonomous Investments = ₹ 500 crores, and
- Consumption function, C = 100 + 0.80Y
A firm is able to sell any quantity of a good at a given price. The firm's Marginal Revenue will be ______
Marginal Propensity to Save is equal to ______
Calculate Autonomous Consumption expenditure from the following data about an economy which is in equilibrium:
National Income = Rs 1,200
Marginal Propensity to Save = 0.20
Investment expenditure = Rs 100
Which of the following points establish the relationship between MPS and MPC?
In an economy, 75 percent of the increase in income is spent on consumption. Investment is increased by Rs 1,000 crore. Calculate the Total increase in income?
What is "MPS" or the 'marginal propensity' to save?
The simplest consumption function assumes ______
If the value of Average Propensity to Save (APS) is 0.2 and National Income is ₹4,000 crores, then consumption will be ______
When we add up utility derived from consumption of all the units of the commodities, we get:
If the marginal propensity to consume is greater than marginal propensity to save, the value of the multiplier will be:
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 increase in National Income is equal to increase in consumption, identity the value of Marginal Propensity to Save:
Assertion (A): At the break-even level of income, the value of Average Propensity to Consume (APC) is zero.
Reason (R): Sum of Average Propensity to Consume (APC) and Average Propensity to Save (APS) is always equal to one.
If increase in National Income is equal to increase in Savings, the value of Marginal Propensity to Consume would be ______.
Complete the following table:
| INCOME (Y) |
SAVING (S) |
APC |
| 0 | (-) 12 | |
| 20 | 6 |
How is APS obtained from the APC?
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.
