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Question Practice

In absence of a government in the two-sector model, which of the following is correct?

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MCQ_SA
CBSE
Class 12
Economics
Introductory Macroeconomics
Determination Of Income And Employment
Question Bank

In absence of a government in ...

Single Answer MCQ
Q-00089072

In absence of a government in the two-sector model, which of the following is correct?

1

Taxes are included in savings

2

Investment does not fluctuate

3

Consumers do not save

4

Consumption and investment determine aggregate demand

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In a two-sector model, aggregate demand (AD) is defined as the sum of which two components?

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Q2.

What does the variable 'Y' represent in the equation Y = C + I + cY?

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Q3.

In the two-sector model, the term 'A' in the equation Y = A + cY represents what?

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Q4.

If actual output (Y) exceeds planned aggregate demand (C + I), what happens in the economy?

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