National Income and Related Aggregates-Stocks and Flows (CBSE Class-12 Economics): Questions 1 - 2 of 2

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Question number: 1

» National Income and Related Aggregates » Stocks and Flows

» National Income and Related Aggregates » Types of Goods

» National Income and Related Aggregates » Real and Nominal GDP

Short Answer Question▾

Write in Short

State whether the following statements are true or false. Give reasons for your answer:

(a) Capital formation is a flow.

(b) Bread is always a consumer good.

(c) Nominal GDP can never be less than Real GDP.

(d) Gross domestic capital formation is always greater than gross fixed capital formation.

Question number: 2

» National Income and Related Aggregates » Stocks and Flows

Appeared in Year: 2012

Essay Question▾

Describe in Detail

Autonomous consumption = 100 Rs.

Marginal propensity to consume = 0.70

National income = 1000 Rs.

Explanation

In this C = 100 Rs.

Pc (b) = 0.70

Y = 1000

So, consumption expenditure = C + by

= 100 + 0.70 × 1000

=100 + 700

= Rs. 800

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