This a MCQ (Multiple Choice Question) based practice test of Chapter 4 - Income Determination of Economics of Class XII (12) for the quick revision/preparation of School Board examinations
Q In a two sector economy Aggregate Demand equals
The sum of the Average Propensity to Consume (APC) and Average Propensity to save (APS) is always equal to unity, i.e., APC + APS = 1. It is so because the money income can either be spent on consumption or it can be saved.
In S= -a+ (1-b) Y, -a represents
The law of Psychological consumption states
MPS= 1+MPC. It is
MPS + MPC = 1
The coefficient (1-b) is also known as