CBSE Class 12 Economics Determination of Income and Employment MCQs

Refer to CBSE Class 12 Economics Determination of Income and Employment MCQs provided below. CBSE Class 12 Economics MCQs with answers available in Pdf for free download. The MCQ Questions for Class 12 Economics with answers have been prepared as per the latest syllabus, CBSE books and examination pattern suggested in Class 12 by CBSE, NCERT and KVS. Multiple Choice Questions for Chapter 4 Determination of Income and Employment are an important part of exams for Class 12 Economics and if practiced properly can help you to get higher marks. Refer to more Chapter-wise MCQs for CBSE Class 12 Economics and also download more latest study material for all subjects

MCQ for Class 12 Economics Chapter 4 Determination of Income and Employment

Class 12 Economics students should refer to the following multiple-choice questions with answers for Chapter 4 Determination of Income and Employment in Class 12. These MCQ questions with answers for Class 12 Economics will come in exams and help you to score good marks

Chapter 4 Determination of Income and Employment MCQ Questions Class 12 Economics with Answers

 

Question :  Which of the following indicates AD in an open economy?

a) Private (household) Consumption Expenditure

b) Household Investment Expenditure

c) Government expenditure + private consumption expenditure

d) Household consumption expenditure+ investment expenditure + government expenditure + net exports

Answer :  Household consumption expenditure+ investment expenditure + government expenditure + net exports

 

Question :  Consumption function is a functional relationship between:

a) Income and saving

b) Price and consumption

c) Income and consumption

d) Income, consumption and saving

Answer :  Income and consumption

 

Question :  Propensity to consume means:

a) Tendency of the consumer  towards higher consumption

b) Ratio of consumption to income

c) Level of income at which consumption expenditure is equal to income

d) Additional income to be spent on consumption

Answer :  Ratio of consumption to income

 

Question :  Average propensity to consume (APC) equal to :

a)

CBSE Class 12 Economics Determination of Income

b)

CBSE Class 12 Economics Determination of Income 1

c)

CBSE Class 12 Economics Determination of Income 2

d)

CBSE Class 12 Economics Determination of Income 3

Answer :

CBSE Class 12 Economics Determination of Income 2

 

Question :  MPC being equal to 0.5, what will be , if income increases by Rs.100?

a) Rs. 60

b) Rs. 50

c) Rs. 40

d) Rs. 70

Answer :  Rs. 50

 

Question :  Propensity to save means:

a) Ratio of saving to income

b) level of income at which saving is equal to income

c) Additional income that is not to be saved

d) None of these

Answer :  Ratio of saving to income

 

Question :  If MPS is 0.6,what will be ∆S when income increases by Rs.100 ? 

a) Rs. 60

b) Rs. 50

c) Rs. 40

d) Rs.70

Answer :  Rs. 60

 

Question :  Average propensity (APS) is equal to:

a)

CBSE Class 12 Economics Determination of Income

b)

CBSE Class 12 Economics Income & Employement Online Test 1

c)

CBSE Class 12 Economics Income & Employement Online Test 2

d)

CBSE Class 12 Economics Income & Employement Online Test 3

Answer :

CBSE Class 12 Economics Income & Employement Online Test 2

 

Question :  Which of the following is correct ?

a) MPC÷MPS=1         

b) 1-MPC=MPS

c) 1-MPS= MPC

d) All of these

Answer :  All of these

 

Question :  If MPC is 40 per cent, MPS will be

a) 70 percent

b) 60 percent

c) 50 percent

d) 40 percent

Answer :  60 percent

 

Question :  Since As= C+S and AD=C+I the equilibrium will be established where C+S= C+I, or where:

a) S=I     

b) S>I

c) S<I 

d) All the above

Answer :  S=I     

 

Question :  Equilibrium level of income/ output and employment is viewed from which of the following approaches ?

a) AS=AD approach

b) S=I approach

c) Both (a) and (b) 

d) None of these

Answer :  Both (a) and (b) 

 

Question :  On account of injections and withdrawals, equilibrium level of income undergoes :

a) A shift

b) No shift

c) A dispersal 

d) No change

Answer :  A shift

 

Question :  According to Keynes, equality (equilibrium) between AD and AS can take place in a situation

a) Less than full employment

b) Full employment

c) Beyond full employment  

d) All of these

Answer :  All of these

 

Question :  If MPC = 0.9, than value of multiplier will be:

a) 6        

b) 9

c) 10

d) 12

Answer :  10

 

Question :  Multiplier=

a) ∆Y/∆S

b) ∆Y/∆I

c) ∆I/∆Y

d) ∆Y/∆C

Answer :  ∆Y/∆I

 

Question :  Multiplier is estimated as:

a) 1/MPC

b) 1/1-MPC

c) 1/1+MPC    

d) 1/1+MPS

Answer :  1/1-MPC

 

Question :  If MPS =1/4, the value of multiplier will be :

a) 4

b) 2

c) 8

d) 6

Answer :  4

 

Question :  If MPC = 0, the multiplier will be:

a) 1

b) 0

c) 2

d) X

Answer :  1

 

Question :  If an investment of Rs. 10 crore results in an increase in income by Rs 50 crore, then the multiplier will be:

a) 5

b) 4

c) 2 

d) None of these

Answer :  5

 

Question :  Deficient demand leads to :

a) Deflationary Gap

b) Inflationary Gap

c) Both and (a) and (b)  

d) None of these

Answer :  Deflationary Gap

 

Question :  Deflationary gap is measured as :

a) ADF + ADU

b) ADF÷ ADU

c) AD- ADU

d) None of these

Answer :  ADF- ADU

 

Question :  Which of the following does not lead to fall in AD ?

a) Fall in private consumption expenditure

b) Fall in export

c) Fall in Import

d) Fall in Government Expenditure

Answer :  Fall in Import

 

Question :  Deficient or excess demand can be corrected through

a) Fiscal Policy

b) Monetary Policy

c) Both (a) and (b)   

d) None of these

Answer :  Both (a) and (b)   

 

Question :  With a view to correcting deflationary gap or deficient demand, which of the following fiscal policy measures should be adopted ?

a) Reduction in taxes

b) Increase in public expenditure

c) Reduction in public debt

d) All of these

Answer :  All of these

 

Question :  Which of the following leads to increase in AD ?

a) Fall in imports

b) Increase in investment expenditure

c) Increase in government expenditure

d) All of these

Answer :  All of these

 

Question :  Of the following, what are the quantitative measures of monetary policy ?

a) Repo rate

b) Open market operations 

c) SLR

d) All of these

Answer :  All of these

 

Question :  A tax the burden of which can be shifted on to others, is called :

a) Indirect Tax

b) Direct Tax

c) Ad Valorem

d) Specific Tax

Answer :  Indirect Tax

 

Question :  The difference between fiscal and interest payment is called :

a) Revenue Deficit

b) Primary Deficit 

c) Bbudget Deficit

d) Capital Deficit

Answer :  Primary Deficit 

 

Question :  If the value exports exceeds the value of visible imports, the current account deficit will be:

a) Positive

b) Negative

c) Positive or Negative 

d) None of these

Answer :  Positive or Negative 

Part A Microeconomics Chapter 01 Introduction to Micro Economics
CBSE Class 12 Economics Microeconomics MCQs
Part A Microeconomics Chapter 02 Theory of Consumer Behaviour
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Part A Microeconomics Chapter 04 The Theory of Firm Under Perfect Competition
CBSE Class 12 Economics The Theory of Firm Under Perfect Competition MCQs
Part A Microeconomics Chapter 05 Market Equilibrium
CBSE Class 12 Economics Forms of Market and Price Determination MCQs
Part A Microeconomics Chapter 06 Non Competitive Markets
CBSE Class 12 Economics Non Competitive Markets MCQs
Part B Macroeconomics Chapter 01 Introduction to Macroeconomics
CBSE Class 12 Economics Macroeconomics MCQs
Part B Macroeconomics Chapter 03 Money and Banking
CBSE Class 12 Economics Money and Banking MCQs
Part B Macroeconomics Chapter 04 Determination of Income and Employment
CBSE Class 12 Economics Determination of Income and Employment MCQs
Part B Macroeconomics Chapter 05 Government Budget and Economy
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