Determination of income and employment

Identify which one is the example/examples of Investment?

• A) Purchase of machinery

• B) Purchase of car

• C) Purchase of building

• D) all of the given

Read the Following statement carefully.

Statement 1: There is a direct relationship between MPC and the value of Multiplier.

Statement 2: Multiplier Higher the MPC, more will be the value of multiplier and vice-versa.

• A) Statement one is true and two 2 is false

• B) Both the statement are true

• C) Statement two is true and one is false

• D) None of the statement are true

Which option is related with MPS?

• A) Change in consumption due to change in income.

• B) Change in income due to change in consumption.

• C) Change in savings due to change in income

• D) Change in income due to change in savings

Read the following statements Assertion (A) and Reason (R) and choose one of the correct alternatives given below:

Assertion: At higher level of income, people generally have lower marginal propensity to consume.

Reason: Keynes psychological law suggest that “consumption increases as income increases but at lower rate.

• A) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

• B) Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).

• C) Assertion (A) is true, but Reason (R) is false.

• D) Assertion (A) is false, but Reason (R) is true.

“1‟ would be the minimum value of Multiplier. (True or false) 1

• True

• False

Which of the following is the correct definition of "Full Employment"?

• A) All workers are employed at all times

• B) Only skilled workers are employed

• C) Every person who wants to work can find employment at the prevailing wage rate

• D) Unemployment is zero at all times

Involuntary unemployment occurs when:

• A) Workers voluntarily leave their jobs for personal reasons

• B) Workers are unable to find work despite being willing and able to work at the prevailing wage rate

• C) Workers are employed in part-time jobs by choice

• D) People retire before the legal retirement age

Full employment is a condition where all available labour resources are utilized in the most efficient manner possible, with only frictional unemployment existing.

• True

• False

Involuntary unemployment is the result of workers' voluntary decisions to leave their jobs or reduce working hours.

• True

• False