Advertisements
Advertisements
प्रश्न
State whether the following statements are True or False with reasons:
Increase in consumption expenditure is less than increase in income.
उत्तर
True, increase in consumption expenditure is less than increase in income.
Explanation:
According to the Keynesian Psychological law of consumption, when there is an increase in income, the consumption expenditure also increases. However, the increase in consumption expenditure is less than the increase in income.
APPEARS IN
संबंधित प्रश्न
............... consumption can not be zero.
(Induced / Autonomous / Government / Private)
Marginal propensity to consume + marginal propensity to save ......................... '
(zero \ one \ less \ more)
Distinguish between marginal propensity to consume and average propensity to consume. Give a numerical example.
Define marginal propensity to consume
An economy is in equilibrium. Calculate Marginal Propensity to Consume :
National income = 1000
Autonomous consumption expenditure = 200
Investment expenditure = 100
Suppose marginal propensity to consume is 0.8. How much increase in investment is required to increase national income by Rs. 2000 crore? Calculate.
An economy is in equilibrium. Find marginal propensity to consume :
Autonomous consumption
Expenditure = 100
Investment expenditure = 100
National Income = 2,000
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 calculate autonomous consumption.[4]
(i) Income = 10,000
(ii) Marginal propensity to consume = 0.2
(iii) Autonomous consumption = 1,500
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 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
Calculate Marginal Propensity to Consume from the following data about an economy
Which is an equilibrium:
National income = 2000
Autonomous Consumption expenditure = 200
Investment expenditure = 100
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:
Explain the subjective and objective factors determining consumption function.
Distinguish between :
Propensity to consume and Propensity to save.
Explain the following concepts or give definitions.
Consumption
Choose the correct answer :
When income increases consumption and saving will _________.
Distinguish between Average propensity to consume and Marginal propensity to consume.
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 autonomous consumption? Explain with the help of a diagram.
Answer the following question.
Which of the two, average propensity to consume or average propensity to save, can be negative, and why?
Calculate the change in final income, if Marginal Propensity to Consume (MPC) is 0.8 and change in initial investment is ₹ 1,000 crores.
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 ____________.
What will be APC when APS = 0?
If the income is ₹ 400 crores and consumption is ₹ 250 crores, what will be the APC?
The relation between APC and MPC in Keynes Psychological consumption function is ______.
APC + APS = ?
MPC = MPS = ?
The value of MPC is ______
A firm is able to sell any quantity of a good at a given price. The firm's Marginal Revenue will be ______
Which of the following statement is true?
MPC = 1 − MPS. It is ______
Marginal Propensity to Save is equal to ______
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 |
The rate of increase in ______ due to a unit increment in income is called marginal propensity to consume.
When we add up utility derived from consumption of all the units of the commodities, we get:
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 ______.
If the marginal propensity to consume is greater than marginal propensity to save, the value of the multiplier 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)?
Identify the correctly matched pair from Column A to column B:
| Column A | Column B |
| (1) MPC = 0 | (a) K > 1 |
| (2) MPC = 1 | (b) K = Infinity |
| (3) MPC < 1 | (c) K = 0 |
| (4) MPC > MPS | (d) K < 1 |
In an economy 75 percent of the increase in income is spent on consumption. Investment increased by ₹ 1,000 crore.
Calculate the total increase in income on the basis of given information.
An Economy is in equilibrium, calculate the Marginal Propensity to Save (MPS) from the following:
- National Income (Y) = ₹ 4,400
- Autonomous Consumption `bar("C")` = ₹ 1,000
- Investment Expenditure (I) = ₹ 70
How is APS obtained from the APC?
APC can be greater than one, but MPC is always less than one. Give a reason to justify this phenomenon.
