Tag: concept of consumption function, saving function and investment function

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Questions Related to concept of consumption function, saving function and investment function

Multiple choice economics concept of consumption function, saving function and investment function capital economy of a village wealth, capital and money

The number of units of capital required in order to produce one unit of output is termed as:

  1. Capital output ratio

  2. Input output ratio

  3. Investment ratio

  4. Capital input ratio
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Units of capital employed to produce a certain level of output divided by total units of output gives us the capital output ratio. It is measured in order to check the efficiency and effectiveness of an organization.

Multiple choice economics concept of consumption function, saving function and investment function capital economy of a village wealth, capital and money

Fixed capital stands for ______.

  1. money with the proprietor

  2. tools, machines, buildings etc. which can be used in production over many years

  3. money deposited in the bank

  4. total share of capital
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Fixed capital refers to investment in long-term assets. Management of fixed capital involves the allocation of the firm’s capital to different projects or assets with long-term implications for the business. For example, tools, machines, buildings, etc. which can be used in production over many years. 

Multiple choice economics concept of consumption function, saving function and investment function capital economy of a village wealth, capital and money

What are 'raw materials and money in hand' called?

  1. Working capital

  2. Fixed capital

  3. Physical capital

  4. Human capital
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Working capital  is a financial metric which represents operating liquidity available to a business, organization or other entity, including governmental entity. Along with fixed assets such as plant and equipment, working capital is considered a part of operating capital. Gross working capital equals to current assets. Working capital is calculated as current assets minus current liabilities. If current assets are less than current liabilities, an entity has a working capital deficiency, also called a working capital deficit.

Multiple choice economics concept of consumption function, saving function and investment function capital economy of a village wealth, capital and money

Those hidden qualities in a person which earn him an income and cannot be transferred from one place to another are called ________.

  1. trade capital

  2. social capital

  3. human or personal capital

  4. fixed capital
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Human capital belongs to that person itself, it cannot be delegated or transferred from one person to another. It is an individual's effort and potential talent coinciding with the availability of proper opportunity which helps them to earn income.

Multiple choice economics concept of consumption function, saving function and investment function capital economy of a village wealth, capital and money

Capital includes all those goods (items or commodities) which are used for further production of more goods, e.g. _______________.

  1. machines and tools

  2. factory buildings

  3. transport equipments

  4. all the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Capital goods are generally a long term investment as it is used to produce many different products.