NET-Assignment_4

Marginal Propensity to Consume is

• Total consumption divided by total income.

• Changes in technology.

• Increase in consumption due to one unit increase in income.

• Income-saving rate

In explaining the level of unemployment, Keynes emphasized

• Changes in technology

• Aggregate demand

• Inflationary expectations

• Lending by financial institutions

Assume that the consumption function is of the form, C= 50+.8Y. If income is Rs 1000/- then consumption is,-

• Rs 500/-

• Rs 1050/-

• Rs 850/-

• Rs 50/-

In the simple Keynesian model consumption is a function of

• Rate of interest

• Level of income

• Price level

• None of the above

In the simple Keynesian model investment is

• Fixed

• Either fixed or a function of level of income

• A function of level of income

• None of the above

Which of the following statement is correct?

• APC-APS=1

• MPC+ APS=1

• MPC-MPS=1

• MPC+MPS=1

Keynesian analysis is

• A short run analysis

• Long run analysis

• Both short and long run analysis

• Neither short nor long run analysis

The average propensity to consume is measured by

• C=Y

• Y/C

• C/Y

• C+Y

The marginal propensity to consume is equal to

• Total spending/Total consumption

• Total consumption/ Total income

• Change in consumption/ Change in income

• Change in consumption/ Change in savings

If MPC=0.65, what will be the value of MPS?

• 0.55

• 0.35

• 0.15

• 0.30