Determination of Income and Employment Test

Result

Determination of Income and Employment Test - 1

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Weekly Quiz Competition

Question 1
1 / -0

The saving is negative at

A
Maximum level of Income

B
High level of Income

C
Zero level of Income

D
Low level of Income

Solution

S=Y-C

Putting, Y =0

We have , S=0-C

S=-C. So, at zero level of income, saving is negative
Question 2
1 / -0

If APC is 0.7 then APS will be

A
0.7

B
0.3

C
1

D
0.4

Solution

Given, APC=0.7

APS=1-APC= 1-0.7= 0.3
Question 3
1 / -0

At low level of income saving is negative.

A
False.

B
Insufficient information

C
True.

D
Can’t say

Solution

First need of a person is cosumption, when consumption gets over or his basic wants are satisfied, he starts saving a part. But, saving being function of income, depends on the latter.So, when income level is low, cosumption is not over, and exceeds income.Thus , leads to negative saving.
Question 4
1 / -0

The slope of the saving function gives the

A
Increase in savings per unit increase in the income.

B
The amount of dissavings done when there is zero level of income.

C
The amount of dissavings done when there is high level of income.

D
The amount of savings done when there is high level of income.

Solution

Slope of saving function implies rate of change of saving with respect to income.
Question 5
1 / -0

APC =

A
C/Y

B
C/S

C
C/D

D
C/G

Solution

APC implies the ratio of income that is consumed and is given by total consumption divided by total income.
Question 6
1 / -0

If MPC is less than one, it follows that

A
(1-b) i.e. MPS is negative

B
(1-b) i.e. MPS is positive

C
(1-b) i.e. MPS is zero

D
(1-b) i.e. MPS is infinity

Solution

b stands for MPC. So, when b is less than 1,evidently 1-b is positive or 1-b>0
Question 7
1 / -0

If MPC =0.75, then MPS will be

A
2.5

B
25.5

C
1

D
0.25

Solution

MPS=1-MPC

MPS= 1-0.75. (given)

=0.25
Question 8
1 / -0

If the initial increase in the investment is Rs 1000 and MPC=0.8, the multiplier will be

A
4

B
3

C
5.0

D
6

Solution

K=1/1-mpc

= 1/1-0.8

=1/0.2

=5

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Re-Attempt Weekly Quiz Competition

Determination of Income and Employment Test - 1

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Determination of Income and Employment Test - 1

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Question 1

Maximum level of Income

High level of Income

Zero level of Income

Low level of Income

Solution

Question 2

0.7

0.3

1

0.4

Solution

Question 3

False.

Insufficient information

True.

Can’t say

Solution

Question 4

Increase in savings per unit increase in the income.

The amount of dissavings done when there is zero level of income.

The amount of dissavings done when there is high level of income.

The amount of savings done when there is high level of income.

Solution

Question 5

C/Y

C/S

C/D

C/G

Solution

Question 6

(1-b) i.e. MPS is negative

(1-b) i.e. MPS is positive

(1-b) i.e. MPS is zero

(1-b) i.e. MPS is infinity

Solution

Question 7

2.5

25.5

1

0.25

Solution

Question 8

4

3

5.0

6

Solution

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