An economy is in equilibrium. Calculate the National Income from the following:
Autonomous Consumption = 120
Marginal Propensity to Save = 0·2
Investment Expenditure = 150
CBSE OUTSIDE DELHI - SET 3 2015
Download our app for free and get started
$\text{Y} =\overline{\text{C}}+ \text{MPC} (\text{Y}) + \text{I}$$=120+(1-0.2)\text{Y}+150$
$0.2\text{Y}=270$
$\text{Y}=1350$
$0.2\text{Y}=270$
$\text{Y}=1350$
Download our appand get started for free
Experience the future of education. Simply download our apps or reach out to us for more information. Let's shape the future of learning together!No signup needed.*
Similar Questions
- 1View SolutionDifferentiate between APC and MPC.
- 2View SolutionDistinguish between average propensity to consume and average propensity to save. What is the relation between the two?
- 3View SolutionExplain the meaning of investment multiplier. What can be its minimum and maximum value and why?
- 4View SolutionWhat happens to the level of national income when aggregate demand falls short of aggregate supply?
- 5View SolutionDefine full employment in an economy. Discuss the situation when aggregate demand is more than aggregate supply at full employment income level.
- 6View SolutionAn economy is in equilibrium. Find Marginal Propensity to Consume from the following:
National income = 2000
Autonomous consumption = 400
Investment expenditure = 200 - 7View SolutionWith the help of saving function S = -50 + 0.2(Y) calculate consumption expenditure at the income level of ₹ 5,000 crore.
- 8View SolutionIn an economy, everytime income rises, 75% of the rise in income is spent on consumption. Now, suppose in the same economy, investment rises by ₹ 750 crore. Calculate the following:
- Change in income.
- MPS.
- 9View SolutionAn economy is in equilibrium. From the following data, calculate the marginal propensity to save:
- Income = 10,000
- Autonomous consumption = 500
- Consumption expenditure = 8,000
- 10View SolutionDifferentiate between APC and APS and tell which of them is negative.