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प्रश्न
Explain the following concepts or give definitions.
Consumption
उत्तर
Consumption refers to that amount of income which is spent on the purchase of goods and services by an individual. It is the expenditure incurred by households on the day to day consumption activities. For example, expenditure incurred on purchase of food, clothes etc.
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संबंधित प्रश्न
Distinguish between marginal propensity to consume and average propensity to consume. Give a numerical example.
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
An economy is in equilibrium. Find investment expenditure:
National Income =1,000
Autonomous Consumption =100
Marginal propensity to consume =0.8
Suppose marginal propensity to consume is 0.8. How much increase in investment is required to increase national income by Rs. 2000 crore? Calculate.
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.
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 Rs. 800 crore and marginal propensity to consume is 0.8, explain the working of multiplier
An economy is in equilibrium. From the following data, calculate the marginal propensity to save:
1) Income = 10,000
2) Autonomous consumption = 500
3) Consumption expenditure = 8,000
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
Explain the Keynesian psychological law of consumption.
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’.
Write explanatory answer:
Explain the subjective and objective factors determining consumption function.
Define or explain the concept Average propensity to save .
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________.
Match the following Group ‘A’ with Group ‘B’:
| Group ‘A’ | Group ‘B’ | ||
| (a) | Giffen’s goods | (1) | Uses of commodities |
| (b) | Essential commodities | (2) | Keynes |
| (c) | Consumption | (3) | Primary function of bank |
| (d) | Consumption function | (4) | Inferior goods |
| (e) | Accept deposits | (5) | Money lender |
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(6) | Inelastic demand | |
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(7) | Luxurious commodities |
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(8) | Dr. Marshall |
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.
Write short note on:
Paradox of value
Define 'or' explain the following concept.
Propensity to save
Answer the following question.
What is meant by a propensity to consume?
Answer the following question.
What is meant by autonomous consumption? Explain with the help of a diagram.
The consumption function of an economy is : C = 40 + 0.8 Y (amount in ₹ crores). Determine that level of income where the average propensity to consume will be one.
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?
Calculate the change in final income, if Marginal Propensity to Consume (MPC) is 0.8 and change in initial investment is ₹ 1,000 crores.
Which one is correct?
Which of the following is correct?
A consumer spending on the purchase of goods regardless of the income in possession is an example of _______ consumption.
______ buy goods and services for consumption and also supply factors of production.
If MPC is less than one, it follows that ______
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 are related with marginal propensity to consume?
The sum of MPC and MPS is always equal to _____
Which of the following points establish the relationship between MPS and MPC?
If MPC is 0.9, what is the value of the multiplier? How much investment is needed to increase national income by Rs 5,000 Crores
What is "MPS" or the 'marginal propensity' to save?
Why public goods must be provided by the government?
The rate of increase in ______ due to a unit increment in income is called marginal propensity to consume.
The simplest consumption function assumes ______
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 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 |
If in an economy, the value of investment multiplier is 4 and Autonomous Consumption is ₹ 30 Crore, the relevant consumption function would be :
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.
