Determination of Income and Employment Class 12 MCQ Quiz – Test Your Understanding!

Average Propensity to Consume can never be ………………………... (choose the correct alternative)

Graphically, the Aggregate Demand function can be obtained by vertically adding the _________ and _________ functions.

If the increase in National Income is equal to an increase in consumption, identity the value of Marginal Propensity to Save :

What is the term used to describe the level of output where Aggregate Demand is equal to Aggregate Supply?

What is the impact of an increase in reverse repo rate on the lending capacity of commercial banks?

As the Marginal Propensity to Save (MPS) increases, the value of the investment multiplier ____________. (Choose the correct alternative)

The impacts of "Excess Demand‟ under the Keynesian theory of income and employment, in an economy are: (choose the correct alternative)

Choose the equation that represents the equilibrium condition in a two-sector economy.

Cut in Repo rate by RBI is likely to……….. (increase/decrease) the demand for goods and services in the economy. (choose the correct alternative)

Decrease in Cash Reserve Ratio will lead to…...........… (choose the correct alternative)

The difference by which actual Aggregate Demand exceeds the Aggregate Demand, required to establish full employment equilibrium is known as……….………(inflationary gap/deflationary gap). (choose the correct alternative)

What happens when ex-ante Aggregate Demand is more than ex-ante Aggregate Supply?

What is the value of the investment multiplier, when the Marginal Propensity to Consume (MPC) is 0.1?

The total consumption and investment curves are given below:

Identify which of the following represents “Autonomous Consumption”.

If in an economy, the value of the investment multiplier is 4 and Autonomous Consumption is ₹ 30 Crore, the relevant consumption function would be: