Macro

Income & Employment

Medium

Arrange the following steps of determination of equilibrium income in chronological order if

C = 40 + 0.8Y, I = 10.

(A) Y = C + I

(B) 0.2Y = 50

(C) Y = 50 + 0.8Y

(D) Y = 250

Choose the correct answer from the options given below:

(A), (B), (C), (D)

(A), (C), (B), (D)

(B), (A), (D), (C)

(C), (B), (D), (A)

(A), (B), (C), (D)

(A), (C), (B), (D)

(B), (A), (D), (C)

(C), (B), (D), (A)

✅ Correct Option: 2

Option 2: (A), (C), (B), (D) -> The correct chronological order for determining equilibrium income starts with the equilibrium condition Y = C + I, then substituting the given values to get Y = 50 + 0.8Y, followed by rearranging to isolate Y terms as 0.2Y = 50, and finally solving to get Y = 250. This follows the logical sequence of: stating the equilibrium condition → substitution → algebraic rearrangement → final solution. -> correct

2025: 16 May Shift 1

Measure the level of ex-ante aggregate demand when autonomous investment and consumption expenditure (A) is Rs 80 crores, and MPC is 0.75.

2023: 1 June Shift 1

Slope of Consumption curve is denoted by :

2026: 19 May Shift 2

Match the LIST-I with LIST-II

LIST-I (Income related Aggregates)	LIST-II (Computation)
A. Saving	I. Consumption plus investment
B. Aggregate Demand	II. Income minus consumption
C. Marginal Propensity to consume	III. 1 / 1 - MPC
D. Investment multiplier	IV. Change in consumption / Change in Income

Choose the correct answer from the options given below:

2026: 19 May Shift 2

Figure out the correct statement with respect to consumption function of an economy.

2026: 21 May Shift 1

Which is the correct sequence of determination of income in an economy as a result of change in autonomous expenditure?

(A) The output and aggregate demand increase.

(B) The increment in the autonomous investment in the economy is Rs. 10 Cr.

(D) The investment multiplier works in forward direction.

Choose the correct answer from the options given below:

2025: 3 June Shift 1

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

Solution

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