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Plus Two Economics Chapter 10 – Online Practice Exam in English

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Chapter 10

Income Determination

Chapter 11 Income Determination

Multi-choice Practice Exam

Question

1) One among the following is not a characterestic of Keynesian consumption function:

Answers

The aggregate real consumption consumption expenditure is a stable function of real income

The MPC must lie in between zero and one

The consumption is a function of rate of interest

MPC = 1 – MPS

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Question

2) If the value of MPC in an economy is unity, the value of MPS will be 

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One

Zero

Infinity

Two

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Question

3) If all the people of the economy increase the proportion of income they save, the aggregate savings in the economy will not increase. This phenomenon is known as

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Paradox of thrift

Paradox of prosperity

Leontif paradox

Giffen paradox

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Question

4) Among the following, choose the one which represent the multiplier:

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one by MPC

MPC devided by MPS

MPS devided by MPC

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Question

5) MPC =

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c/y

ΔC/ΔY

mps three

four

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Question

6) Match the following

A B
1)ΔC/ΔY i MPS
2)Consumption when income is zero ii Multiplier
3)ΔS/ΔY iii MPC
4)1/1-c iv Autonomous consumption

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1)iii, 2)iv, 3)i, 4)ii

1)ii, 2)iii, 3)i, 4)iv

1)i, 2)iii, 3)iv, 4)ii

1)iv, 2)iii, 3)i, 4)ii

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Question

7) MPC increases , equilibrium income will

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Increase

Decrease

remain same

None of these

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Question

8) In the given equation C = 100 + .8y, MPC is

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100

100 + .8y

.8

100.8y

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Question

9) In the equation AD =Ᾱ+cY, if investment increases the aggregate demand curve will shift 

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Parallally upwards

Parallally downwards

pivot upward

pivot downward

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Question

10) In a two  sector model, equilibrium income equals

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A bar consumption

c by y

None of these

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Question

11) Ex Ante values are called

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Planned values

Actual values

Realized values

Actual and realised values

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Question

12) MPS is 0.25,  then multiplier is

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1

0.75

1.33

4

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Question

13) MPC + ___ = 1

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MPC

MPS

MEC

None of these

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Question

14) At equilibrium AD = __

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DD

C

I

AS

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Question

15) C = 20 + 0.8Y, if  income = 100, then consumption will be

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10

80

100

20

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Question

16) MPC is 0.8, then MPS is

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1

.2

2

.8

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Question

17) Change in graph due to the change in parameters is called 

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Parametric shift

Movement along the curve

Expansion

Contraction

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Question

18) y = a + bx is a 

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Linear equation

Radical equation

Rational equation

None of these

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Question

19) MPS = 1 – ___

Answers

MEC

MPC

MPS 

Consumption

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Question

20) Find odd-one

Answers

Consumption demand

Investment demand

Derived demand

Government demand

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