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

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

A 100% Consumption Economy ______________________.

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

  1. Cannot have any Capital Formation

  2. Will become static and cannot grow

  3. Both (a) and (b)

  4. Neither (a) nor (b)

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Correct Option: C

Capital Formation is possible by _______________________.

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

  1. Using whole of the current capacity to produce only Consumer Goods

  2. Reducing present consumption to a certain extent

  3. Both (a) and (b)

  4. Neither (a) nor (b)

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Correct Option: B

Capital Formation is required for _________________.

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

  1. Increasing the efficiency of production efforts

  2. Expansion of output of consumer goods in the future.

  3. Ensuring growth of the economy

  4. All the above

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Correct Option: D

Ability to Save depends upon _________________.

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

  1. Average level of income

  2. Distribution of national income.

  3. Both (a) and (b)

  4. Neither (a) nor (b)

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Correct Option: C

For the purpose of Capital Formation, which of the following create "Savings" in an economy?

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

  1. Individuals or Households

  2. Business Enterprises

  3. Government

  4. All of the above

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Correct Option: D

Which of these is a source of savings for Government?

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

  1. Tax and Fees Collections

  2. Profits of PSUs

  3. Both (a) and (b)

  4. Neither (a) nor (b)

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Correct Option: C

Capital Formation involves ___________________.

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

  1. Creation of Savings

  2. Mobilisation of Savings

  3. Investment of Savings into Real Capital

  4. All of the above

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Correct Option: D

Real Capital Formation requires ___________________.

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

  1. An entrepreneurial class which is prepared to bear the risk of business

  2. Economic and industrial policies in which Investment is given initiative

  3. An inducement to invest, e.g. prospective rate of profit

  4. All of the above

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Correct Option: D

Inducement to Invest is influenced by _______________________.

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

  1. Prospective Rate of Profit

  2. Rate of Interest

  3. Both (a) and (b)

  4. Neither (a) nor (b)

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Correct Option: C

In the pre-reforms period (i.e. before 1991), import permission was available primarily for _______________.

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

  1. Consumer Goods

  2. Capital Goods

  3. Both (a) and (b)

  4. Neither (a) nor (b)

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Correct Option: B