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Calculate Investment Expenditure from the Following Date About an Economy Which is in Equilibrium : National Income = 1000 Marginal Propensity to Save = 0.20 Autonomous Consumption Expenditure = 100 - Economics

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प्रश्न

Calculate investment expenditure from the following date about an economy which is in equilibrium :
National Income = 1000
Marginal propensity to save = 0.20
Autonomous consumption expenditure = 100

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उत्तर

Given that

National income (Y) = 1000

Marginal propensity to save (MPS) = 0.20

Autonomous consumption expenditure = 100

MPC(c) = 1 - MPS = 1 - 0.20 = 0.8

 As we know that

Y= C + I

Since `C = barC + cY`

We have

`Y = barC + cY + I`

`1000 = 100 + 0.8(1000) + I`

1000 = 900 + I

I = 100

Therfore, investment expenditure is Rs 100.

 

 

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2013-2014 (March) All India Set 2

संबंधित प्रश्न

What is revenue expenditure?


Distinguish between revenue expenditure and capital expenditure in Government budget. Give an example of each.


Explain how taxes and government expenditure can be used to influence revenue expenditure and capital expenditure?


Which one of these is a revenue expenditure?


Is the following revenue expenditure or capital expenditure in the context of government budget? Give reason.

Expenditure on purchasing computers


Giving reason, state whether the following is a revenue expenditure or a capital expenditure in a government budget:

Expenditure on scholarships


Giving reason, state whether the following is a revenue expenditure or a capital expenditure in a government budget:

Expenditure of building a bridge.


Answer the following question.
How are capital expenditure different from Revenue expenditure?  Discuss briefly.


The expenditure multiplier is the ratio of ______.


S. No. Content Rs (in crores)
1. Revenue Expenditure 100
2. Capital Receipts 40
3. Net Borrowings 38
4. Net Interest Payments 27
5. Tax Revenue 50
6. Non-tax Revenue 15

Which of the following shows fiscal deficit?


S. No. Content Rs (in crores)
1. Revenue Expenditure 100
2. Capital Receipts 40
3. Net Borrowings 38
4. Net Interest Payments 27
5. Tax Revenue 50
6. Non-tax Revenue 15

What will be the primary deficit?


Level of planned output coincides with planned expenditure when ______


Purchase of shares is related to ______


Calculate Investment expenditure from the following data about an economy that is in equilibrium.

National Income = Rs 1,000

Marginal Propensity to Save = 0.20

Autonomous consumption expenditure = Rs 100


Subsidies and expenditure on scholarships are examples of ______


Which one of the following is not a capital expenditure?


Identify the correctly matched pair of the items in Column A to those in Column B:

Column A Column B
1. Revenue Expenditure (a) Does not cause any reduction in government liability
2. Capital Expenditure (b) Which creates corresponding liability for the government
3. Revenue Receipts (c) Which causes a reduction in assets of the government
4. capital Receipts (d) Causes reduction in government liability.

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