At the break-even point level of incomes for the economy is ...

CBSE 2022 Class 12 Economics Delhi Set 3 (Term 2)

Question : 3

Total: 6

At the break-even point level of incomes for the economy is ₹10,000 crores and if the people tends to save 20 per cent of their additional income, then calculate the value of autonomous consumption.

Solution:

C=‌C+‌ by ‌ ‌[‌ At Break even point] ‌
10,000=‌C+0⋅8(10,000)
10,000=‌C+8,000
10,000−8,000=‌C=₹2000‌ crores ‌
Working Notes:
b‌=MPC
C‌=Y
∵‌S‌=0
∴‌C‌=10,000
MPS‌=0⋅2‌ (given) ‌
MPC‌=1−MPS
‌=1−0⋅2=0−8

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