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Income Determination

Total questions: 15

Worksheet time: 6mins

Name
Class
Date
1.

Average propensity to Consume is equal to :-

a)

Y/C

b)

ΔY/ΔS

c)

C/Y

d)

ΔC/ΔY

2.

Autonomous Investment curve looks like:-

a)
b)
c)
d)
3.

Components of Aggregate demand are

a)

Consumption(C) & Investment(I)

b)

Consumtion(C) & saving(S)

4.

Autonomous consumption is equal to

a)

Saving

b)

Dissaving

5.

Y=C+=?

a)

Saving(S)

b)

Export(X)

6.

Two components of AS(Aggregate supply) are

a)

C+G

b)

C+S

7.

Autonomous Consumption is __________________ related to the level of Income.

a)

Totally

b)

Inversely

c)

Positively

d)

Not

8.

The APC can be measured by dividing change in consumption with the change in disposable income.

a)

TRUE

b)

FALSE

9.

Which of the following best describes the aggregate demand curve?

a)

It is a curve that shows the relationship between consumer spending and income.

b)

It is a curve that shows the amount of goods and services domestic consumers will buy from domestic and foreign firms.

c)

It is a curve that shows the level of spending by consumers, businesses, the government, and the foreign sector at different price levels.

d)

It is a curve that shows only the level of government spending at different price levels.

e)

It is a curve that shows the level of spending by all factors of production at different price levels.

10.

Aggregate Supply is same as

a)

National output

b)

National Income

c)

Both (a) & (b)

d)

None of the above

11.

Which of the following is not a component of AD in a 2 sector economy?

a)

Net Exports

b)

Govt. Expenditure

c)

Consumption

d)

Both (a) & (b)

12.

Break-even point is achieved when:

a)

National Income = Consumption

b)

Consumption = Saving

c)

Consumption = Investment

d)

National Income> Consumption

13.

Which of these is a component of AD?

a)

Private final consumption expenditure

b)

Investment expenditure

c)

Govt final consumption expenditure

d)

All of the above

14.

Tick on the correct Consumption Curve.

a)
b)
15.

Aggregate Supply & _____ are always equal.

a)

AD

b)

MPC

c)

National Income

d)

APC