All Courses
Get the App Signup / Login
Sign in Open App
Commerce Exam  >  Commerce Tests  >  Economics Class 12  >  Test: Determination of Income and Employment- Assertion & Reason Type Questions - Commerce MCQ

Test: Determination of Income and Employment- Assertion & Reason Type Questions - Commerce MCQ


Test Description

12 Questions MCQ Test Economics Class 12 - Test: Determination of Income and Employment- Assertion & Reason Type Questions

Test: Determination of Income and Employment- Assertion & Reason Type Questions for Commerce 2024 is part of Economics Class 12 preparation. The Test: Determination of Income and Employment- Assertion & Reason Type Questions questions and answers have been prepared according to the Commerce exam syllabus.The Test: Determination of Income and Employment- Assertion & Reason Type Questions MCQs are made for Commerce 2024 Exam. Find important definitions, questions, notes, meanings, examples, exercises, MCQs and online tests for Test: Determination of Income and Employment- Assertion & Reason Type Questions below.
Solutions of Test: Determination of Income and Employment- Assertion & Reason Type Questions questions in English are available as part of our Economics Class 12 for Commerce & Test: Determination of Income and Employment- Assertion & Reason Type Questions solutions in Hindi for Economics Class 12 course. Download more important topics, notes, lectures and mock test series for Commerce Exam by signing up for free. Attempt Test: Determination of Income and Employment- Assertion & Reason Type Questions | 12 questions in 24 minutes | Mock test for Commerce preparation | Free important questions MCQ to study Economics Class 12 for Commerce Exam | Download free PDF with solutions
Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 1
Save

Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:

Assertion (A): Aggregate Demand is expressed in terms of total expenditure made in the economy.

Reason (R): Aggregate Demand constitutes of Consumption Expenditure, Investment Expenditure, Government Expenditure and Net Exports.

Detailed Solution for Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 1
Aggregate Demand refers to the value of final goods and services which all sectors of an economy are planning to buy during a year.
Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 2
Save

Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:

Assertion (A): Private Consumption Expenditure is determined by the level of personal disposable income of the economy.

Reason (R): The total demand for all goods or services by the household in an economy during an accounting year, is termed as Private Consumption Expenditure.

Detailed Solution for Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 2
Private consumption expenditure measures consumer spending on goods and services.
1 Crore+ students have signed up on EduRev. Have you? Download the App
Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 3
Save

Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:

Assertion (A): Full employment is the situation where all those workers who are able to work and willing to work get employment at the prevailing wage rate.

Reason (R): The situation of full employment is achieved only when the economy is in equilibrium.

Detailed Solution for Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 3
Full employment equilibrium refers to a situation when equilibrium is attained i.e., aggregate demand is equal to aggregate supply at full employment level.
Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 4
Save

Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:

Assertion (A): If AD>AS, the firm will employ more factors of production.

Reason (R): When AD is more, in order to get back to the equilibrium level the economy bringing AD equal to AS.
Detailed Solution for Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 4
In response to the increase in the price level, producers create more goods and services. This continues until the amount of aggregate production equals the amount of aggregate demand. As prices fall, the amount of aggregate demand increases and the economy returns to equilibrium.
Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 5
Save

Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:

Assertion (A): There is an inverse relationship between the value of marginal propensity to save and investment multiplier.

Reason (R): Saving is a leakage in the circular flow of income. Greater the saving, greater the leakage and lower the value of investment multiplier.
Detailed Solution for Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 5
Higher the MPS, lower the multiplier and lower the MPS, higher the multiplier, as K=1/MPS.
Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 6
Save

Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:

Assertion (A): The minimum value of investment multiplier is equal to one.

Reason (R): The minimum value of investment multiplier is 1, when MPC is 0 and MPC can never be negative.
Detailed Solution for Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 6

K = 1/1 – MPC

= 1/1 – 0 = 1

Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 7
Save

Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:

Assertion (A): Aggregate demand refers to planned purchase of goods and services during a year.

Reason (R): AD is the sum total of expenditure that the people plan or desire to incur on the purchase of goods and services produced in an economy during an accounting year.
Detailed Solution for Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 7
Aggregate expenditure is the current value of all the finished goods and services in the economy. The equation for aggregate expenditure is: AE = C + I + G + NX. The aggregate expenditure equals the sum of the household consumption (C), investments (I), government spending (G), and net exports (NX).
Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 8
Save

Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:

Assertion (A): When income is zero, consumption is also zero.

Reason (R): There is always some minimum level of consumption in the economy even when income is zero.
Detailed Solution for Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 8
When income is zero, consumption is not zero as there is always some minimum level of consumption in the economy.
Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 9
Save

Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:

Assertion (A): If S>I, then equilibrium income will have a tendency to reduce.

Reason (R): As according to Keynes, the income employment equilibrium is determined at the point where investments and savings are equal.
Detailed Solution for Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 9
In the Keynesian analysis, the equilibrium level of employment and income is determined at the point of equality between saving and investment. Saving is a function of income, i.e. S = f (Y). It is defined as the excess of income over consumption, S=Y-C and income is equal to consumption plus investment.
Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 10
Save

Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:

Assertion (A): AS increases proportionate to the increase in AD so long as there is excess capacity in the economy.

Reason (R): Excess capacity arises because of excess supply.
Detailed Solution for Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 10
Excess capacity arises because of deficiency of demand.
Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 11
Save

Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:

Assertion (A): Saving and investment are always equal.

Reason (R): Planned S and Planned I are equal only at equilibrium level.
Detailed Solution for Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 11
Saving (S) and Investment (I) can be realized (ex-post) and planned (ex-ante). Planned S and Planned I are equal only at equilibrium level. Realized S and realized I are always equal.
Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 12
Save

Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:

Assertion (A): The maximum value of investment multiplier is equal to infinity.

Reason (R): The maximum value of investment multiplier is ∞, when MPC is 1, i.e., whole additional income is converted into additional consumption.
Detailed Solution for Test: Determination of Income and Employment- Assertion & Reason Type Questions - Question 12
K = 1/1 – MPC

= 1/1 – 1

= 1/0 = ∞

86 videos|337 docs|54 tests
Join Course
Information about Test: Determination of Income and Employment- Assertion & Reason Type Questions Page
In this test you can find the Exam questions for Test: Determination of Income and Employment- Assertion & Reason Type Questions solved & explained in the simplest way possible. Besides giving Questions and answers for Test: Determination of Income and Employment- Assertion & Reason Type Questions, EduRev gives you an ample number of Online tests for practice

Top Courses for Commerce

86 videos|337 docs|54 tests
Join Course
Download as PDF

Top Courses for Commerce

Important Questions for Determination of Income and Employment- Assertion & Reason Type Questions

Find all the important questions for Determination of Income and Employment- Assertion & Reason Type Questions at EduRev.Get fully prepared for Determination of Income and Employment- Assertion & Reason Type Questions with EduRev's comprehensive question bank and test resources. Our platform offers a diverse range of question papers covering various topics within the Determination of Income and Employment- Assertion & Reason Type Questions syllabus. Whether you need to review specific subjects or assess your overall readiness, EduRev has you covered. The questions are designed to challenge you and help you gain confidence in tackling the actual exam. Maximize your chances of success by utilizing EduRev's extensive collection of Determination of Income and Employment- Assertion & Reason Type Questions resources.

Determination of Income and Employment- Assertion & Reason Type Questions MCQs with Answers

Prepare for the Determination of Income and Employment- Assertion & Reason Type Questions within the Commerce exam with comprehensive MCQs and answers at EduRev. Our platform offers a wide range of practice papers, question papers, and mock tests to familiarize you with the exam pattern and syllabus. Access the best books, study materials, and notes curated by toppers to enhance your preparation. Stay updated with the exam date and receive expert preparation tips and paper analysis. Visit EduRev's official website today and access a wealth of videos and coaching resources to excel in your exam.

Online Tests for Determination of Income and Employment- Assertion & Reason Type Questions Economics Class 12

Practice with a wide array of question papers that follow the exam pattern and syllabus. Our platform offers a user-friendly interface, allowing you to track your progress and identify areas for improvement. Access detailed solutions and explanations for each test to enhance your understanding of concepts. With EduRev's Online Tests, you can build confidence, boost your performance, and ace Determination of Income and Employment- Assertion & Reason Type Questions with ease. Join thousands of successful students who have benefited from our trusted online resources.
© EduRev
Education Revolution
Follow Us
Signup to see your scores go up
within 7 days!
Takes less than 10 seconds to signup