Macro

Income & Employment

Medium

Identify the correct statement from the following:

A. Consumption curve starts from the origin

B. The sum of APC and APS is equal to 1

C. Aggregate demand and market demand mean the same

D. The value of MPC and MPS varies between 0 and 1

E. At breakeven point saving is zero

Choose the correct answer from the options given below:

A, D, E only

B, C, D only

B, D, E only

A, C, E only

✅ Correct Option: 3

B is true: APC + APS = 1. D is true: MPC and MPS each lie between 0 and 1. E is true: at breakeven point Y = C so saving = 0. A is false (consumption starts at autonomous level, not origin). C is false (aggregate demand is macro, market demand is micro). Hence B, D, E only.

2025: 27 May Shift 2

The equilibrium level of output may be more or less than the full employment level of output. If it is less than the full employment of output, it is due to the fact that demand is not enough to employ all factors of production. This situation is called ......

2025: 28 May Shift 2

In the consumption equation, the slope of the consumption function is represented as:

2025: 2 June Shift 1

Match List-I with List-II

List-I	List-II
(A) Marginal Propensity to Consume	(I) C/Y
(B) Marginal Propensity to Save	(II) ΔC/ ΔY
(C) Average Propensity to Save	(III) S/Y
(D) Average Propensity to Consume	(IV) ΔS/ ΔY

Choose the correct answer from the options given below:

2023: 29 May Shift 2

C=40+0.8Y and I =10, then what will be the equilibrium level of income?

2025: 26 May Shift 2

If the entire additional income is saved in an economy, the value of investment multiplier will be

2023: 29 May Shift 2

A country's consumption function described as

C=500+ 0.7 Y

the Autonomous consumption

Solution

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