InterviewSolution
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InterviewSolution
This section includes InterviewSolutions, each offering curated multiple-choice questions to sharpen your knowledge and support exam preparation. Choose a topic below to get started.
| 1. |
find investment from the following : National Income = Rs. 500 Autonomous consumption = Rs. 100 Marginal propensity to consume `=0.75` |
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Answer» `Y=bar(C)+MPC. Y+I` `500=100+(0.75xx500)+I` `I=500-100-375= Rs. 25` |
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| 2. |
In an economy, `C=1000+0.5 Y` and `I=2,000`, calculate : (i) Equilibrium level of income. (ii) Saving at equilibrium level of income. |
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Answer» (i) `Y=C+I=1000+0.5 Y+2000=3000+0.5 Y` or `0.5 Y=3000` `Y=6000` (ii) `S=Y-C=6000-(1000+0.5xx6000)`. `=6000-4000=2000`. |
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| 3. |
In an economy `C=500+0.9 Y` and `I=1,000` (where `C=` consumption, `Y=` income, `I=` investment). Calculate the following : (i) Equilibrium level of income. (ii) Consumption expenditure at equilibrium level of income. |
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Answer» given `Y=C+I` (i) `Y=500+0.9 Y+1000` `Y=1500+0.9 Y` or `0.1 Y=1,500` `Y=` Rs. `15,000` (ii) `C=Y-I=15,000-1,000=` Rs. `14,000`. |
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| 4. |
The consumption function curve is :A. Upward slopingB. Downward slopingC. Parallel to the X-axisD. Parallel to the Y-axis |
| Answer» Correct Answer - A | |
| 5. |
Value of multiplier is determined by :A. MPSB. MPCC. Both (a) and (b)D. Investment |
| Answer» Correct Answer - C | |
| 6. |
In an economy, every time the income rises, `75` percent of the rise in income is spent on consumption. Now suppose in the same economy investment rises by Rs. `750` crore. Calculate : (i) change in income, (ii) change in saving. |
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Answer» (i) `MPC=0.75, :. MPS=0.25` `:. K=1/(1-MPC)=1/(1-0.75)=4` `:. DeltaY=K. Delta I=4xx750` crore = Rs. `3,000` crore `133` (ii) `DeltaS=DeltaY-DeltaC=3,000-(0.75xx3,000)` `=3000-2250` crore = Rs. `750` crore. |
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