Determination of Income and Employment

18 solved questions from Class 12 Economics, each with the full working. Tap any question to see the step-by-step solution.

1 What is the primary topic or theoretical principle explored in 'Determination of Income and Employment' (Class 12 ECONOMICS)? medium MCQ Chapter Core Principle
2 Which key mechanism or analytical rule is highlighted in 'Determination of Income and Employment'? medium MCQ Key Analytical Mechanism
3 What is the primary topic or principle explained in 'Determination of Income and Employment' (Class 12 Economics)? medium MCQ Chapter Core Concept
4 Which key observation or fact is central to understanding 'Determination of Income and Employment'? medium MCQ Key Fact & Mechanism
5 Why is the study of 'Determination of Income and Employment' important for students of Class 12? medium MCQ Learning Significance
6 What is a common application or real-world example related to 'Determination of Income and Employment'? medium MCQ Real World Application
7 What key takeaway should students retain after completing 'Determination of Income and Employment'? medium MCQ Chapter Summary & Takeaway
8 The government decides to increase its expenditure by Rs 200 billion. If the marginal propensity to consume (MPC) in the economy is 0.6, by how much will the equilibrium national income rise? medium 2 marks Fiscal policy multiplier
9 An economy has a marginal propensity to save (MPS) of 0.4. Calculate the multiplier. medium 2 marks Marginal propensity to consume
10 In a closed economy, consumption is given by C = 50 + 0.8Y, investment I = 100, government expenditure G = 150, and tax T is 20% of income (T = 0.2Y). Net exports are zero. Find the equilibrium level of national income Y using the Keynesian cross model. hard 5 marks Keynesian equilibrium income
11 If the marginal propensity to consume (MPC) in an economy is 0.75, what is the value of the Keynesian multiplier? easy MCQ 1 mark Multiplier effect
12 Consider an economy where the consumption function is C = 100 + 0.7(Y-T), investment is I = 80, initial government expenditure is G = 120, and taxes are flat 30. Net exports are zero. If the government increases its expenditure by Rs. 50 billion and simultaneously raises taxes to 10% of the new income (T = 0.1Y), what will be the new equilibrium level of national income? hard 4 marks Fiscal policy and multiplier
13 In a closed economy, consumption is given by C = 40 + 0.55(Y-T), investment is I = 100, government expenditure is G = 140, and taxes are T = 0.15Y. Net exports are zero. Find the equilibrium level of national income Y. medium 3 marks Equilibrium national income
14 If the marginal propensity to consume (MPC) in an economy is 0.8, what is the value of the Keynesian multiplier? easy 1 mark Keynesian multiplier
15 A closed economy has the following components: C = 100 + 0.85(Y - T), I = 70, G = 150, taxes are T = 0.2Y, and net exports are zero. What is the equilibrium national income Y (in billions of rupees)? hard MCQ 3 marks Equilibrium income calculation
16 In a closed economy, the consumption function is given by C = 30 + 0.6(Y-T), investment I = 80, government expenditure G = 120, taxes are T = 0.2Y, and net exports are zero. What is the equilibrium national income Y (in billions of rupees)? easy MCQ 2 marks Equilibrium income using Keynesian cross
17 In an economy with consumption function C = 50 + 0.7(Y - T), investment I = 120, government expenditure G = 200, taxes given by T = 0.1Y + 20 (where 20 is a lump‑sum tax), and net exports zero, find the equilibrium level of national income Y (in billions of rupees). hard 4 marks Equilibrium with tax schedule and multiplier
18 If the marginal propensity to consume (MPC) in an economy is 0.75 and the government increases its expenditure by Rs. 200 billion, by how much will the equilibrium national income rise? medium 3 marks Keynesian multiplier effect