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CBSE 2015 Class 12 Economics Outside Delhi Set-1

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Question : 13 of 18
Marks: +1, -0
An economy is in equilibrium. Calculate the Investment Expenditure from the following:
National Income =800=800
Marginal Propensity to Save =0.3=0.3
Autonomous Consumption =100=100
Solution:  
Given
Y  =800Y\;=800
MPS(s)  =0.3\mathrm{MPS}(s)\;=0.3
i.e, MPC(c)  =1−   MPS   =1−0.3=0.7\mathrm{MPC}(c)\;=1-\;\text{ MPS }\;=1-0.3=0.7
C  =100C\;=100
We know that at equilibrium,
Y  =C+1Y\;=C+1
C  =ab+byC\;=ab+by
  =100+0.7y\;=100+0.7y
By putting the value of YY and CC
800=100+0.7(800)+I800=100+0.7(800)+I
800  =100+560+I800\;=100+560+I
I  =800−660I\;=800-660
I  =₹140I\;=\text{₹}140
Thus, the Investment expenditure is ₹140\text{₹}140 .
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