CUET Economics 2023 20 June Shift 1 PYQs

In an Economy , total savings are rs. 2000 crores and the ratio of average propensity to save and average propensity to consume is 2: 7. Calculate the level of income in the economy?

If there is an increase in investment by Rs100 in an economy, MPC = 0.9, choose the correct sequence with reference to the working of the investment multiplier.

(A) Producers increase their planned output further by (0.9)10, the income of the economy goes up by (0.9)10 and consumption demand increases further by (0.9)² 10.

(B) This process goes on, round after round.

(C) Income increases by 100, Consumption expenditure increases by 90 and therefore, aggregate demand goes up by 90.

(D) The total increment in the income will be 1000.

Choose the correct answer from the options given below:

When autonomous investment increases in a two-sector model, then.

1. The aggregate demand curve shifts upwards.
2. Output/GDP increases by the same magnitude as the change in investment.
3. Autonomous expenditure increases by the same magnitude as the change in investment.
4. The consumption curve shifts upwards.