Macro

Income & Employment

Easy

If the ratio between MPC and MPS is 4:1, the value of investment multiplier will be:

✅ Correct Option: 3

MPC + MPS = 1. Ratio 4:1 gives MPC = 0.8, MPS = 0.2. Investment multiplier k = 1/MPS = 1/0.2 = 5.

2022: 16 July Shift 2

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:

2026: 11 May Shift 1

What is the value of the vertical intercept and slope of the given equation for the consumption function?

$C = A + \frac{1}{2}Y$

2026: 13 May Shift 2

The ex-ante term refers to ?

2025: 29 May Shift 1

Among the following identify the condition where firms face unplanned de-cumulation of inventories.

2023: 11 June Shift 3

The 'Effective Demand Principle' states that aggregate output is determined solely by :

2025: 22 May Shift 1

Match List-I with List-II

List-I	List-II
(A). Marginal propensity to consume (MPC)	(I). C/ Y
(B). Consumption function	(II). C + I
(C). Average propensity to consume (APC)	(III). ΔC/ ΔY
(D). Aggregate Demand	(IV). C = c + cY

Choose the correct answer from the options given below:

Solution