Question : _____________________ is defined as ratio of change in consumption to change in total income

Option 1: Marginal propensity to consume

Option 2: Marginal propensity to save

Option 3: Average propensity to consume

Option 4: Average propensity to save.

Question : The marginal propensity to consume (MPC) is 0.9. If disposable income increases by INR 2,000, what will be the increase in consumption?

Option 1: INR 1,800
  

Option 2: INR 1,600
    

Option 3: INR 2,000

Option 4: INR 2,200

Question : The consumption function shows the relationship between:

Option 1: Saving and income
 

Option 2: Consumption and saving
  

Option 3: Consumption and investment

Option 4: Consumption and income

Question : __________________________ refers to the consumption expenditure to the corresponding level of income.
 

Option 1: Average propensity to consume
 

Option 2: Marginal propensity to consume
 

Option 3: Average propensity to save
 

Option 4: None of the above.
 

Question : The marginal propensity to consume (MPC) is the proportion of an additional:

Option 1: Income that is saved
  

Option 2: Income that is consumed
  

Option 3: Investment that is made

Option 4: Government expenditure that is incurred