If the level of effective demand is much below the level of full employment equilibrium then which situation will appear in the economy ? Option 1: Full employment equilibrium Option 2: Under employment equilibrium Option 3: Beyond full employment equilibrium Option 4: Excess demand

The answer is 'Under employment equilibrium'. View full solution:

CUET Economics - If the level of effective demand is much below the level of full employment equilibrium then which situation will appear in the economy ? | PYQs + Solutions

CUET Economics

Macro

Easy

Full employment equilibrium

Under employment equilibrium

Beyond full employment equilibrium

Excess demand

✅ Correct Option: 2

Related questions:

3 June Shift 1

Due to weakening of global economic activity, level of aggregate demand ___________ in the economy.

11 June Shift 3

Find out correct one :

(A) MPC is the change in consumption per unit change in income

(B) MPS is the saving per unit of income

(D) APS is the change in saving per unit change in income

Choose the correct answer from the options given below :

CUET Economics 2022 Slot 2

Match List I with List II

LIST I (Concept under Theory of Income determination)	LIST II (Meaning)
A. Saving < Investment	I. When AD<AS
B. $\frac{1}{1-mpc}$	II. Under employment equilibrium
C. National income will fall	III. Planned inventory would fall below the desired level
D. AD=AS at a point less than full employment	IV. Multiplier

Choose the correct answer from the options given below: