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

Calculate autonomous consumption expenditure from the following data about an economy which is in equilibrium:

National Income	=	₹ 500
Marginal Propensity to Save	=	0.30
Investment expenditure	=	100

What are the main forms of market?

Should we treat subsidies as transfer payments?

In an economy, as a result of increase in investment by ₹ 100 crore, National Income rises by ₹ 1,000 crore. Find Marginal Propensity to Consume.

How can surplus budget be used during inflation?

Complete the following table:

Units of Labour	TP	MP	AP
0	0	-	0
1	-	-	20
2	-	-	26
3	66	-	-
4	-	19	-
5	-	-	4

Quantity demanded of a commodity rises by 6 units, when its price falls by 1 per unit. Its Price Elasticity of Demand is (-) 1. If the price before the change was ₹ 20 per unit, calculate quantity demanded at this price.

Which technology of production would you prefer in rural India, a 'labour intensive' one, which would curtail the problem of unemployment to certain extent or a 'capital intensive' one, which is very highly productive in nature?

Consider a market with two firms. The following table shows the supply schedules of the two firms: the SS1 column gives the supply schedule of firm 1 and the SS2 column gives the supply schedule of firm 2. Compute the market supply schedule.

Price (Rs)	SS1 (units)	SS2 (units)
0 1 2 3 4 5 6	0 0 0 1 2 3 4	0 0 0 1 2 3 4

Suppose that the demand curve for the XYZ company slopes downward and to the right. Would you conclude that the firm is a price taker or a price maker? Give reasons.