Description : An economy is in equilibrium when - (1) planned consumption exceeds planned saving (2) planned consumption exceeds planned investment (3) intended saving equals intended investment (4) intended investment exceeds intended savings
Last Answer : (3) intended saving equals intended investment Explanation: In economics, economic equilibrium is a state of the world where economic forces are balanced and in the absence of external influences ... and intended investment. An economy is in equilibrium when total savings equal total investment.
Description : What is "mpc" or the 'marginal propensity to consume'? a) the proportion of total additional planned savings to total additional income b) the proportion of total additional income to total additional ... c) the fraction of total additional income that is used for consumption d) none of the above
Last Answer : : c) the fraction of total additional income that is used for consumption
Description : What is "mps" or the 'marginal propensity to save'? a) the proportion of total additional planned savings to total additional income b) the proportion of total additional income to total additional ... c) the fraction of total additional income that is used for consumption d) none of the above
Last Answer : a) the proportion of total additional planned savings to total additional incom
Description : The "planned"• value of the variables like consumption, investment, output, etc, is known as: a) ex post measures b) ex ante measures c) ex pre measures d) none of the above
Last Answer : a) ex post measures
Description : In free economy the decision about investment, saving and consumption are decided by (a) Price mechanism ; (b) Central bank ;(c) Planning Commission ;(d) Finance budget
Last Answer : (a) Price mechanism
Description : Consumptions function refers to - (1) relationship between income and employment (2) relationship between savings and investment (3) relationship between input and output (4) relationship between income and consumption
Last Answer : (4) relationship between income and consumption Explanation: The Consumption function is a single mathematical function used to express consumer spending. It was developed by John Maynard Keynes and ... by current income and induced consumption that is influenced by the economy's income level.
Description : Investment multiplier shows the effect of investment on - (1) Employment (2) Savings (3) Income (4) Consumption
Last Answer : (3) Income Explanation: Investment multiplier is simply the multiplier effect of an injection of investment into an economy. The multiplier effect refers to the idea that an initial spending rise can lead to even greater increase in national income
Description : Investment and savings are kept equal through a change in the level of - (1) Consumption (2) Investment (3) Government expenditure (4) Income
Last Answer : (1) Consumption Explanation: Desired savings are kept equal to desired investment by responses to interest rate changes. Savings identity or the savings investment identity is a concept in ... brings savings and investment into balance without any intention by business to increase investment.
Description : Consumption function expresses the relationship between consumption and - (1) savings (2) income (3) investment (4) price
Last Answer : (2) income Explanation: The consumption function is a mathematical formula laid out by famed economist John Maynard Keynes. The formula was designed to show the relationship between real disposable ... being what Keynes considered the most important determinant of short-term demand in an economy.
Description : Investment Multiplier is a (a) ratio between income and investment. (b) ratio between investment and savings (c) ratio between consumption and investment (d) None of the abov
Last Answer : (b) ratio between investment and savings
Description : Investment multiplier shows the effect of investment on (1) Employment(2) Savings (3) Income (4) Consumption
Last Answer : Income
Description : Consumption function expresses the relationship between consumption and (1) savings (2) income (3) investment (4) price
Last Answer : income
Description : Consumptions function refers to (1) relationship between income and employment (2) relationship between savings and investment (3) relationship between input and output (4) relationship between income and consumption
Last Answer : relationship between income and consumption
Description : Investment and savings are kept equal through a change in the level of (1) Consumption (2) Investment (3) Government expenditure (4) Income
Last Answer : Consumption
Description : Which of the following relations always holds true? (1) Income = Consumption + Investment (2) Income = Consumption + Saving (3) Saving = Investment (4) Income = Consumption + Saving + Investment
Last Answer : (2) Income = Consumption + Saving Explanation: Consumers do one of two things with their disposable income: They save it or they spend it. So Income = Consumption + Saving.
Description : Which of the following relations always holds true ? (1) Income = Consumption + Investment (2) Income = Consumption + Saving (3) Saving = Investment (4) Income = Consumption + Saving + Investment
Last Answer : Income = Consumption + Saving
Description : If saving exceeds investment, how will the national income? -Do You Know?
Last Answer : answer:
Description : . If the actual rate of unemployment exceeds to natural rate of unemployment then: A. Actual output of the economy will fall below its potential B. Production will increase more than potential C. Consumption of goods decreases D. Both (a) and (c) above.
Last Answer : D. Both
Description : If the actual rate of unemployment exceeds to natural rate of unemployment then (a) Actual output of the economy will fall below its potential ; (b) Production will increase more than potential ; (c) Consumption of goods decreases; (d) Both (a) and (c) above.
Last Answer : (d) Both (a) and (c) above.
Description : In a closed economy savings are equal to ……………….. at the equilibrium level of income. (a) Investments ; (b) Wages ; (c) Income-Investments ; (d) Wages – Consumption
Last Answer : (a) Investments ;
Description : Personal Income' equals - (1) The household sector's in-come (2) Private income minus savings of the corporate sector minus corporation tax (3) Personal disposable income plus miscellaneous receipts of the Goverment (4) All of the above
Last Answer : (3) Personal disposable income plus miscellaneous receipts of the Goverment Explanation: Disposable income is total personal income minus personal current taxes (or plus receipts of the government). ... category of personal (or, private) consumption expenditure) yields personal (or, private) savings
Description : ‘Personal Income’ equals (1) The household sector’s income (2) Private income minus savings of the corporate sector minus corporation tax (3) Personal disposable income plus miscellaneous receipts of the Goverment (4) All of the above
Last Answer : Personal disposable income plus miscellaneous receipts of the Goverment
Description : As the number of investments made by a firm increases, its internal rate of return - (1) declines due to diminishing marginal productivity. (2) declines because the market rate of interest will ... the firm for the current consumption foregone. (4) increases because the level of savings will fall.
Last Answer : (3) increases to compensate the firm for the current consumption foregone. Explanation: Internal rates of return are commonly used to evaluate the desirability of investments or projects. The higher a ... of return is greater than an established minimum acceptable rate of return or cost of capital.
Description : Forced Savings refer to - (1) Reduction of consumption consequent to a rise in prices (2) Taxes on individual income and wealth (3) Compulsory deposits imposed on income tax payers (4) Provident fund contribution of private sector employees
Last Answer : (1) Reduction of consumption consequent to a rise in prices Explanation: Forced saving is an economic situation in which consumers spend less than their disposable income, not because they want to ... free economy, this situation would normally result in increase in prices and inflow of more goods.
Description : The marginal propensity to consume is equal to (a) Total spending/Total consumption (b) Total consumption/ Total income. © Change in consumption/ Change in income (d) Change in consumption/ Change in savings.
Last Answer : © Change in consumption/ Change in income
Description : An increase in marginal propensity to consume will (a) Lead to the consumption function becoming steeper. (b) Shift the consumption function upwards. © Shift the consumption function downwards. (d) Shift the savings function upwards.
Last Answer : d) Lead to the consumption function becoming steeper.
Description : Forced Savings refer to (1) Reduction of consumption consequent to a rise in prices (2) Taxes on individual income and wealth (3) Compulsory deposits imposed on income tax payers (4) Provident fund contribution of private sector employees
Last Answer : Reduction of consumption consequent to a rise in prices
Description : As the number of investments made by a firm increases, its internal rate of return (1) declines due to diminishing marginal productivity. (2) declines because the market rate of interest will fall ... firm for the current consumption foregone. (4) increases because the level of savings will fall.
Last Answer : increases to compensate the firm for the current consumption foregone.
Description : Saving is that portion of money income that is - (1) spent for development of Industries (2) not spent on consumption (3) spent on health and education (4) spent for consumer durables
Last Answer : (2) not spent on consumption Explanation: Saving is income not spent, or deferred consumption. In economics, it refers to any income not used for immediate consumption- consuming less out of a ... is the decision to defer consumption and to store this deferred consumption in some form of asset.
Description : Lower interest rates are likely to (a) Decrease consumption. (b) Increase cost of borrowing. © Encourage saving. (d) Increase borrowing and spending.
Last Answer : (d) Increase borrowing and spending.
Description : Saving is that portion of money income that is (1) spent for development of Industries (2) not spent on consumption (3) spent on health and education (4) spent for consumer durables
Last Answer : not spent on consumption
Description : Pick out the wrong statement. (A) Bubble size increases with the dynamic viscosity of the liquid in case of nucleate pool boiling (B) Thermal conductivity of a dry material is more than ... in kg/hr in an evaporator (D) Vaporisation of organic substances in evaporator mostly causes foam formation
Last Answer : (B) Thermal conductivity of a dry material is more than that of the damp material
Description : 4. For which of the following reasons might inflation cause Real GDP to grow slower than it otherwise would? a. Inflation makes everyone poorer b. Inflation reduces the value of consumer debt c. Inflation increases business investment spending d. Inflation decreases savings in financial form
Last Answer : d. Inflation decreases savings in financial form
Description : Classical economists’ neglects---- side in their theories. (a) demand (b) supply © savings (d) investment
Last Answer : (a) demand
Description : Which among the following method is used to calculate poverty in India? (a) Investment Method. (b) Capital Method. © Savings Method. (d) Income Method.
Last Answer : (d) Income Method.
Description : Per capita income is calculated by dividing total national income by (a) Total population (b) Total savings © Total depreciation (d) Total investment.
Last Answer : (a) Total population
Description : Gross Profit means - (1) Total investment over total saving (2) Changes in methods of production (3) Changes in the form of business organisation (4) Total receipts over total expenditure
Last Answer : (4) Total receipts over total expenditure Explanation: In accounting, gross profit or sales profit is the difference between revenue and the cost of making a product or providing a service, before deducting ... . Gross profit = Net sales (total receipts) - Cost of goods sold (total expenditure).
Description : According to Acceleration principle investment depends on change in the level of------ (a) rate of interest. (b) level of income. © price (d) saving.
Last Answer : (b) level of income.
Description : Gross Profit means (1) Total investment over total saving (2) Changes in methods of production (3) Changes in the form of business organisation (4) Total receipts over total expenditure
Last Answer : Total receipts over total expenditure
Description : This strategy is an expression of desired strategic direction deliberately formulated & planned in terms of resource allocation, control systems, organizational structure etc. A. Intended strategy B. Realized strategy C. Emergent strategy D. None of these options are valid.
Last Answer : Intended strategy
Description : In essence, all organisations have two types of strategy: __________ is the strategy that the organisation decides on during the planning phase, and __________ is the strategy that ... strategy; realised strategy C)intended strategy; implemented strategy D)planned strategy; implemented strategy
Last Answer : B)intended strategy; realised strategy
Description : Capital formation in an economy depends on - (1) Total Income (2) Tot al demand (3) Total savings (4) Total production
Last Answer : (3) Total savings Explanation: Capital formation refers to capital accumulation, referring to the total "stock of capital" that has been formed, or to the growth of this total capital stock. ... a measure of the amount by which the total physical capital stock increased during an accounting period.
Description : Capital formation in an economy depends on (1) Total Income (2) Total demand (3) Total savings (4) Total production
Last Answer : Total savings
Description : Which among the following statements is not true when there is an increase in interest rate in an economy? (1) increase in saving (2) decrease in loan (3) increase in production cost (4) increase in capital return
Last Answer : (4) increase in capital return Explanation: Interest rate increase the cost of borrowing, which results in lesser investment activity and the purchase of consumer durables. In a low interest-rate ... . All of these factors raise output and employment as well as investment and consumer spending.
Description : Which from the following is not true when the interest rate in the economy goes up? (1) Saving increases (2) Lending decreases (3) Cost of production increases (4) Return on capital increases
Last Answer : (4) Return on capital increases Explanation: The interest rate is the cost of demanding or borrowing loanable funds. Alternatively, the interest rate is the rate of return from supplying or lending loanable funds. ... rate per unit of time, which is why it is called the rate of return on capital.
Description : Which among the following statements is not true when there is an increase in interest rate in an economy ? (1) increase in saving (2) decrease in loan (3) increase in production cost (4) increase in capital return
Last Answer : increase in capital return
Description : Which from the following is not true when the interest rate in the economy goes up ? (1) Saving increases (2) Lending decreases (3) Cost of production increases (4) Return on capital increases
Last Answer : Return on capital increases
Description : 6. Assume that Potential Real GDP equals $10,000. National Income is therefore $10,000. Of this, consumers will pay $2,000 in taxes, save $1,000, and spend $7,000 on consumer goods. Business Investment ... . budget deficit of $1000 c. budget surplus of $1000 d. budget deficit of $2000 C C A A C
Last Answer : c. budget surplus of $1000