Theory of consumer behaviour — Economics STD 12 Humanities & Commerce — Question

Identify the law in the statement below:
'A consumer with a given income allocates his expenditure among commodities, so that last rupee spent on each brings equal Marginal Utility':

1. Law of Diminishing Marginal Utility.
2. Law of Equi-marginal Utility.
3. Law of diminishing MRS.
4. None of the above.

If MPC = 1, the value of multiplier is: (Choose the correct alternative)

1. 0
2. 1
3. Between 0 and 1
4. Infinity.

Theory of production studies the problem of:

1. What goods to produce and how much to produce
2. How to produce
3. For whom to produce
4. All of the above

Budget line indicates:

1. Price ratio.
2. Income ratio.
3. Cost ratio.
4. None of these.

When average product (output) increase, marginal product is:

1. Equal to average product.
2. Greater than average product.
3. Less than average product.
4. Zero.

Match the following.

1.	NDPMP	(i)	NDPFC + NFIA
2.	NDPFC	(ii)	GDPMP + Deprecialion
3.	NNPFC	(iii)	GDPMP - NIT - Deprecialion

(Where, NDP = Net Domestic Product, GDP = Gross Domestic Product, NNP = Net National Product, NIT = Net Indirect Taxes, MP = Market Price, FC = Factor Cost, NFIA = Net Factor Income From Abroad)
Codes: I, II, III

1. (iii) (i) (ii)
2. (i) (ii) (iii)
3. (ii) (iii) (i)
4. (ii) (i) (iii)

With a rise in real national income, welfare of the people:

1. Rises.
2. Falls.
3. Remains unchanged.
4. None of the above.

If APS is 0.9, how much will be the APC?

1. 0.2
2. 0.5
3. 1
4. 0.1

Credit creation by commercial banks is determined by:

1. Cash Reserve Ratio (CRR).
2. Statutory Liquidity Ratio (SLR).
3. Initial Deposits.
4. All the above.