CUET Economics - Macro - Income & Employment | Free Questions - Page 5

Q1:

2025: 30 May Shift 1

Macro

>

Income & Employment

Medium

Arrange the following steps in the correct sequence to explain the working of Multiplier.

(A) Increase in income and consumption.

(B) Increase in investment.

(C) Rise in aggregate demand in each round

(D) Generation of additional income.

Choose the correct answer from the options given below:

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

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

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

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

Correct Answer

Option 4

Correct Answer

Explanation

Q2:

2025: 30 May Shift 1

Macro

>

Income & Employment

Medium

At the equilibrium point when C=100+0.5 Y and I= 200, saving will be........................

600

400

200

100

Correct Answer

Option 3

Correct Answer

Explanation

Q3:

2025: 30 May Shift 1

Macro

>

Income & Employment

Easy

When consumer consumes a part of change in income, which of the following is true?

MPC > 1

MPC < 1

MPC = 0

0 < MPC < 1

Correct Answer

Option 4

Correct Answer

Explanation

Q4:

2025: 30 May Shift 1

Macro

>

Income & Employment

Medium

A perfectly elastic aggregate supply curve implies that:

(A) There is fuller utilization of resources in the economy.

(B) There is unemployment of resources in the economy.

(C) There is excess capacity in the economy.

(D) Aggregate demand is less in the economy.

Choose the correct answer from the options given below:

(A), (B) and (D) only

(B), (C) and (D) only

(A) and (D) only

(A) and (C) only

Correct Answer

Option 2

Correct Answer

Explanation

Q5:

2025: 30 May Shift 1

Macro

>

Income & Employment

Easy

Level of planned output coincides with planned expenditure when:

(AD = Aggregate Demand. AS= Aggregate Suplly)

AD=AS

AD>AS

AD < AS

Income is Zero

Correct Answer

Option 1

Correct Answer

Explanation

Q6:

2025: 30 May Shift 1

Macro

>

Income & Employment

Medium

In an economy , the aggregate demand function is given by AD= 80 + 0.75 Y. What will be the value of investment multiplier?

0.25

2

0

4

Correct Answer

Option 4

Correct Answer

Explanation

Q7:

2025: 30 May Shift 1

Macro

>

Income & Employment

Medium

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?

2000 crores.

7000 crores.

9000 crores.

14,000 crores.

Correct Answer

Option 3

Correct Answer

Explanation

Q8:

2025: 29 May Shift 2

Macro

>

Income & Employment

Medium

In which year, the book 'The Economic Consequences of the Peace' was written by John Maynard Keynes.

1909

1919

1929

1936

Correct Answer

Option 2

Correct Answer

Explanation

Q9:

2025: 29 May Shift 2

Macro

>

Income & Employment

Medium

If the marginal propensity to consume is 0.6. Then what will be the value of tax multiplier?

+ 0.25

- 0.25

+ 1.5

- 1.5

Correct Answer

Option 4

Correct Answer

Explanation

Q10:

2025: 29 May Shift 2

Macro

>

Income & Employment

Medium

When aggregate output is determined solely by the level of aggregate demand, the relation between aggregate supply and price is?

Less Elastic.

More Elastic.

Perfectly Elastic.

Perfectly Inelastic.

Correct Answer

Option 3

Correct Answer

Explanation

Q11:

2025: 29 May Shift 2

Macro

>

Income & Employment

Medium

The ratio of the total increment in equilibrium value of final goods output to the initial increment in autonomous investment expenditure is known as?

Investment Multiplier.

Autonomous Multiplier.

Credit Multiplier.

Induce Multiplier.

Correct Answer

Option 1

Correct Answer

Explanation

Q12:

2025: 29 May Shift 2

Macro

>

Income & Employment

Medium

Suppose autonomous investment and consumption expenditure (A) in a hypothetical economy is ₹50 crores. MPS is 0.2 and the level of income is ₹4000 crores. The value of ex-ante aggregate demand would be _________

4000

4200

3250

3300

Correct Answer

Option 3

Correct Answer

Explanation

Q13:

2025: 29 May Shift 2

Macro

>

Income & Employment

Easy

Comprehension:

Read the passage carefully and answer the questions based on the passage:

Aggregate Demand and Its Components

Consumption may denote not what people have actually consumed in a given year, but what they had planned to consume during the same period. Similarly, investment can mean the amount a producer plans to add to her inventory. It may be different from what she ends up doing. The planned values of the variables are called their ex ante measures. The most important determinant of consumption demand is household income. A consumption function describes the relation between consumption and income. The simplest consumption function assumes that consumption changes at a constant rate as income changes. Of course, even if income is zero, some consumption still takes place. Since this level of consumption is independent of income, it is called autonomous consumption. The induced component of consumption, cY shows the dependence of consumption on income.

Which one is not the component of a aggregate demand for final goods?

Price.

Consumption.

Investment.

Government spending.

Correct Answer

Option 1

Correct Answer

Explanation

Q14:

2025: 29 May Shift 2

Macro

>

Income & Employment

Easy

Comprehension:

Read the passage carefully and answer the questions based on the passage:

Aggregate Demand and Its Components

Consumption may denote not what people have actually consumed in a given year, but what they had planned to consume during the same period. Similarly, investment can mean the amount a producer plans to add to her inventory. It may be different from what she ends up doing. The planned values of the variables are called their ex ante measures. The most important determinant of consumption demand is household income. A consumption function describes the relation between consumption and income. The simplest consumption function assumes that consumption changes at a constant rate as income changes. Of course, even if income is zero, some consumption still takes place. Since this level of consumption is independent of income, it is called autonomous consumption. The induced component of consumption, cY shows the dependence of consumption on income.

In a given consumption function C=50+0.5Y, autonomous consumption is.

0.5

50

25

10

Correct Answer

Option 2

Correct Answer

Explanation

Q15:

2025: 29 May Shift 2

Macro

>

Income & Employment

Medium

Comprehension:

Read the passage carefully and answer the questions based on the passage:

Aggregate Demand and Its Components

Consumption may denote not what people have actually consumed in a given year, but what they had planned to consume during the same period. Similarly, investment can mean the amount a producer plans to add to her inventory. It may be different from what she ends up doing. The planned values of the variables are called their ex ante measures. The most important determinant of consumption demand is household income. A consumption function describes the relation between consumption and income. The simplest consumption function assumes that consumption changes at a constant rate as income changes. Of course, even if income is zero, some consumption still takes place. Since this level of consumption is independent of income, it is called autonomous consumption. The induced component of consumption, cY shows the dependence of consumption on income.

Savings are that part of income that is not consumed. What is the marginal propensity to save?

S/Y

C/Y

ΔS

1-c

Correct Answer

Option 4

Correct Answer

Explanation

Q16:

2025: 29 May Shift 2

Macro

>

Income & Employment

Medium

Comprehension:

Read the passage carefully and answer the questions based on the passage:

Aggregate Demand and Its Components

Consumption may denote not what people have actually consumed in a given year, but what they had planned to consume during the same period. Similarly, investment can mean the amount a producer plans to add to her inventory. It may be different from what she ends up doing. The planned values of the variables are called their ex ante measures. The most important determinant of consumption demand is household income. A consumption function describes the relation between consumption and income. The simplest consumption function assumes that consumption changes at a constant rate as income changes. Of course, even if income is zero, some consumption still takes place. Since this level of consumption is independent of income, it is called autonomous consumption. The induced component of consumption, cY shows the dependence of consumption on income.

Which of the following is not correct for marginal propensity to consume?

MPC=0

MPC=1

0 < MPC > 1

0< MPC<1

Correct Answer

Option 3

Correct Answer

Explanation

Q17:

2025: 29 May Shift 2

Macro

>

Income & Employment

Medium

Comprehension:

Read the passage carefully and answer the questions based on the passage:

Aggregate Demand and Its Components

Consumption may denote not what people have actually consumed in a given year, but what they had planned to consume during the same period. Similarly, investment can mean the amount a producer plans to add to her inventory. It may be different from what she ends up doing. The planned values of the variables are called their ex ante measures. The most important determinant of consumption demand is household income. A consumption function describes the relation between consumption and income. The simplest consumption function assumes that consumption changes at a constant rate as income changes. Of course, even if income is zero, some consumption still takes place. Since this level of consumption is independent of income, it is called autonomous consumption. The induced component of consumption, cY shows the dependence of consumption on income.

Machines produced in an economy in a given year are a part of ................

Consumption goods.

Normal goods.

Intermediate goods.

Final goods.

Correct Answer

Option 4

Correct Answer

Explanation

Q18:

2025: 29 May Shift 1

Macro

>

Income & Employment

Medium

In graphical representation, how is the aggregate demand function obtained?

By adding the consumption and investment functions vertically.

By adding the consumption and investment functions horizontally.

By subtracting the consumption function from investment functions.

By multiplying the consumption and investment functions.

Correct Answer

Option 1

Correct Answer

Explanation

Q19:

2025: 29 May Shift 1

Macro

>

Income & Employment

Medium

Match List-I with List-II

List-I	List-II
(A) Ex-post investment	(I) AD function shifts upward
(B) Investment multiplier	(II) Planned Investment + Unplanned Investment
(C) Ex ante aggregate demand	(III) 1/1- MPC
(D) Owing to increase in investment	(IV) $I = c + cY$

Choose the correct answer from the options given below:

(A) - (II), (B) - (III), (C) - (IV), (D) - (I)

(A) - (I), (B) - (III), (C) - (II), (D) - (IV)

(A) - (I), (B) - (II), (C) - (IV), (D) - (III)

(A) - (III), (B) - (IV), (C) - (I), (D) - (II)

Correct Answer

Option 1

Correct Answer

Explanation

Q20:

2025: 29 May Shift 1

Macro

>

Income & Employment

Easy

Suppose in a hypothetical economy ,the income rises from ₹5000 crores to ₹6000 crores. As a result, the consumption expenditure rises from ₹4000 cores to ₹4600 crores. Then what will be the marginal propensity to consume?

0.8

0.4

0.2

0.6

Correct Answer

Option 4

Correct Answer

Explanation

Q21:

2025: 29 May Shift 1

Macro

>

Income & Employment

Medium

If Multiplier is 2.5,how much investment will be required to generate additional income of 1000 crores?

1000 crores

400 crores

100 crores

250 crores

Correct Answer

Option 2

Correct Answer

Explanation

Q22:

2025: 29 May Shift 1

Macro

>

Income & Employment

Medium

Match List-I with List-II

List-I	List-II
(A) Inflationary gap	(I) A cause of deficiency of AD
(B) Decline in exports	(II) A monetary measure to correct disequilibrium between AD and AS
(C) Cash reserve ratio	(III) Pursued by the government of the country
(D) Fiscal policy	(IV) There is no unemployment or underemployment in the country

Choose the correct answer from the options given below:

(A) - (I), (B) - (II), (C) - (III), (D) - (IV)

(A) - (IV), (B) - (I), (C) - (II), (D) - (III)

(A) - (I), (B) - (III), (C) - (IV), (D) - (II)

(A) - (III), (B) - (IV), (C) - (I), (D) - (II)

Correct Answer

Option 2

Correct Answer

Explanation

Q23:

2025: 29 May Shift 1

Macro

>

Income & Employment

Medium

Arrange the following in correct sequence according to their occurance.

(A) Reduction in cash reserve ratio by the Reserve Bank.

(B) Involuntary unemployment situation in the economy.

(C) Increase in credit availability in the capital market.

(D) Aggregate demand falls short of aggregate supply, corresponding to full employment in the economy.

Choose the correct answer from the options given below:

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

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

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

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

Correct Answer

Option 4

Correct Answer

Explanation

Q24:

2025: 29 May Shift 1

Macro

>

Income & Employment

Medium

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

Unexpected rise in sales.

Unexpected fall in sales.

Change in inventories.

Gross value addition.

Correct Answer

Option 1

Correct Answer

Explanation

Q25:

2025: 29 May Shift 1

Macro

>

Income & Employment

Medium

What are the equilibrium conditions in the Keynesian model of income determination?

(A) Aggregate demand = Aggregate supply.

(B) Savings= Investment.

(C) Consumption=Government Expenditure.

(D) Planned Expenditure= Planned Output.

Choose the correct answer from the options given below:

(A) and (B) only

(A), (B) and (C) only

(A), (C) and (D) only

(A), (B) and (D) only

Correct Answer

Option 4

Correct Answer

Explanation

Q26:

2025: 28 May Shift 2

Macro

>

Income & Employment

Hard

Determination of income and employment of a two-sector model is done by:

(A) Ex-ante aggregate demand for final goods.

(B) Ex-post aggregate demand for final goods.

(C) Fixed price of final goods.

(D) Constant rate of interest.

Choose the correct answer from the options given below:

(A), (B) and (D) only

(A), (C) and (D) only

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

(B), (C) and (D) only

Correct Answer

Option 2

Correct Answer

Explanation

Q27:

2025: 28 May Shift 2

Macro

>

Income & Employment

Medium

When $C = 70 + 0.5Y$ and $I = 40$ , what is the equilibrium income?

250

110

220

150

Correct Answer

Option 3

Correct Answer

Explanation

Q28:

2025: 28 May Shift 2

Macro

>

Income & Employment

Medium

Identify the situation in which the equilibrium level of output is less than the full employment level of output?

Aggregate demand.

Equilibrium demand.

Excess demand.

Deficient demand.

Correct Answer

Option 4

Correct Answer

Explanation

Q29:

2025: 28 May Shift 2

Macro

>

Income & Employment

Medium

Arrange the following statement in the context of the effect of an autonomous change in aggregate demand on income and output.

(A) When autonomous investment increases, the aggregate demand shifts in parallel upwards.

(B) Equilibrium level of income depends on aggregate demand.

(C) Excess demand emerges in the economy.

(D) The output will be greater than the original output.

Choose the correct answer from the options given below:

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

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

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

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

Correct Answer

Option 3

Correct Answer

Explanation

Q30:

2025: 28 May Shift 2

Macro

>

Income & Employment

Medium

Match List-I with List-II

List-I	List-II
(A) MPS	(I) $C/Y$
(B) MPC	(II) $\bar{C} + cY$
(C) APC	(III) $1 - c$
(D) Consumption function (C)	(IV) $\Delta C/\Delta Y$

Choose the correct answer from the options given below:

(A) - (II), (B) - (I), (C) - (III), (D) - (IV)

(A) - (I), (B) - (II), (C) - (III), (D) - (IV)

(A) - (I), (B) - (II), (C) - (IV), (D) - (III)

(A) - (III), (B) - (IV), (C) - (I), (D) - (II)

Correct Answer

Option 4

Correct Answer

Explanation

CUET Economics: MacroIncome & Employment. Free, no login required.

Q1:

Q2:

Q3:

Q4:

Q5:

Q6:

Q7:

Q8:

Q9:

Q10:

Q11:

Q12:

Q13:

Q14:

Q15:

Q16:

Q17:

Q18:

Q19:

Q20:

Q21:

Q22:

Q23:

Q24:

Q25:

Q26:

Q27:

Q28:

Q29:

Q30:

CUET Economics Past Year Questions (Topic-Wise)