Question : If MPC is four times MPS and consumption at zero level of income is 50 crore derive the consumption function.

Option 1: C=50+0.2Y

Option 2: C=50+0.8Y

Option 3: C=50-0.2Y

Option 4: C=50-0.8Y

Question : What is the value of MPS in the following savings function S= -100+0.2Y and also determine saving at the Y=1000.

Option 1: -100, 100

Option 2: 0.2, 100

Option 3: 0.8, 100

Option 4: None of the above.

Question : Determine the value of MPS & MPC from the following consumption function, C= 75+0.8Y.
 

Option 1: 0.4, 0.6
 

Option 2: 0.2, 0.8
 

Option 3: 0.5,0.5
 

Option 4: 0.6,0.4
 

Question : Which of the following statements are correct?

1. Consumption function refers to functional relationship between consumption and savings.
2. It is a psychology concept as it is influenced by the subjective factors like consumers, taste preference, etc.
3. It also shows the consumption level at different levels of income.
4. C=f(Y)

Option 1: 1,2&3
 

Option 2: 2,3&4
 

Option 3: 1,3&4
 

Option 4: Only 3&4
 

Question : Production function explains the relationship between:

Option 1: initial inputs and ultimate output

Option 2: input and ultimate consumption

Option 3: output and consumption

Option 4: output and exports