Income Determination CBSE Questions & Answers

Income Determination

This is Economics Class 12 Income Determination CBSE Questions & Answers. There are 15 questions in this test with each question having around four answer choices.

Questions & Answers

1
The equation of saving function is
  • A
    S=f(Y)
  • B
    S = -a+ (1-b) Y
    Correct
  • C
    S= -a+(1-b)
  • D
    C=-a+by.
2
S = -a+(1-b)Y is a
  • A
    Algebraic function of the level of Savings and capital expenditure
  • B
    Algebraic function of the level of Savings
    Correct
  • C
    Algebraic function of the level of Savings and Investment expenditure
  • D
    Linear function of the level of Savings and Consumption expenditure
3
If the initial increase in the investment is Rs 1000 and MPC=0.8, the multiplier will be
  • A
    4
  • B
    6
  • C
    3
  • D
    5.0
    Correct
4
The Breakeven level of an economy is
  • A
    C = I
  • B
    C= Y
    Correct
  • C
    C = AD
  • D
    AD = AS
5
In C= -c+b(Y), ‘C’ denotes
  • A
    Consumption expenditure
    Correct
  • B
    Collateral expenditure
  • C
    Capital expenditure
  • D
    Central expenditure
6
In C= -c+b(Y), ‘ -c’ denotes
  • A
    Autonomous consumption expenditure
    Correct
  • B
    Annual consumption expenditure
  • C
    Consumption expenditure
  • D
    Automatic consumption expenditure
7
In C= -c+b(Y), ‘b’ denotes
  • A
    1-MPC
  • B
    1+MPC
  • C
    MPC
    Correct
  • D
    MPS
8
In C= -c+b(Y), ‘Y’ denotes
  • A
    GDP
    Correct
  • B
    NNP
  • C
    NDP
  • D
    GNP
9
In S= -a+(1-b)Y ‘S’ denotes
  • A
    Level of savings and Capital expenditure
  • B
    Level of sales
  • C
    Level of savings
    Correct
  • D
    Level of subsidies
10
In S= -a+(1-b)Y, ‘a’ denotes
  • A
    Autonomous consumption expenditure
    Correct
  • B
    Annual consumption expenditure
  • C
    Consumption expenditure
  • D
    Automatic consumption expenditure
11
In S= -a+(1-b)Y), ‘ 1-b’ denotes
  • A
    MPC
  • B
    Consumption
  • C
    Multiplier
  • D
    MPS
    Correct
12
In S= -a+(1-b)Y ‘b’ denotes
  • A
    1-MPC
  • B
    MPS
  • C
    1+MPC
  • D
    MPC
    Correct
13
In S= -a+(1-b)Y ‘Y’ denotes
  • A
    NNP
  • B
    GDP
    Correct
  • C
    GNP
  • D
    NDP
14
In S= -a+(1-b)Y , ‘-a’ denotes
  • A
    Negative savings
    Correct
  • B
    Negative Consumption
  • C
    Negative income
  • D
    Negative Investment expenditure
15
The minimum value of investment multiplier can be
  • A
    3.5
  • B
    3
  • C
    1.0
    Correct
  • D
    2