Tag: some macroeconomic identities

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Questions Related to some macroeconomic identities

Multiple choice economics circular flow of income and methods of calculating national income some macroeconomic identities national income accounting national income aggregates

Given personal income of Rs.7510, personal income tax of Rs.410, Consumption being Rs. 5000, Personal saving will be _______.

  1. Rs.7000

  2. Rs.6890

  3. Rs.2100

  4. Rs.6700
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Personal saving is calculated as Personal Income minus Personal Income Tax minus Consumption. Here, 7510 - 410 - 5000 = 2100.

Multiple choice economics circular flow of income and methods of calculating national income some macroeconomic identities national income accounting national income aggregates

Given personal income of Rs.7510, personal income tax of Rs. 410, Consumption being Rs. 5000, Personal saving being Rs. 2100. Find the disposal income.

  1. Rs. 7000

  2. 6890

  3. Rs. 7100

  4. Rs. 6700
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Disposable income is defined as Personal Income minus Personal Income Tax. Here, 7510 - 410 = 7100.

Multiple choice economics circular flow of income and methods of calculating national income some macroeconomic identities national income accounting national income aggregates

______ is the personal income minus personal income tax and miscellaneous payments to government.

  1. Surplus income

  2. Disposable income

  3. Expendable income

  4. Residual income
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Disposable income refers to the income which is freely available to the disposal of the individual. The gap between the personal income of an individual and disposal income is due the taxes and other payments made to the government on the personal income earned. 
Symbolically: ${\text{Disposable Income = Personal Income - Taxes and other payments made to the government on the personal income}}$ 

Multiple choice economics circular flow of income and methods of calculating national income some macroeconomic identities national income accounting national income aggregates

Given personal income of Rs.8000, personal income tax of Rs.1200, Consumption Rs. 5000, Personal saving is equal to ______.

  1. Rs.2000

  2. Rs.2400

  3. Rs.2900

  4. Rs.1800
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Personal saving equals (Personal Income - Personal Income Tax) - Consumption. Calculation: (8000 - 1200) - 5000 = 6800 - 5000 = 1800.

Multiple choice economics circular flow of income and methods of calculating national income some macroeconomic identities national income accounting national income aggregates

The major difference between personal income and disposal income is _______.

  1. indirect tax

  2. direct taxes

  3. savings

  4. investment
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Personal income is the total income received by individuals, while disposable income is the amount left for spending after direct taxes are deducted.

Multiple choice economics circular flow of income and methods of calculating national income some macroeconomic identities national income accounting national income aggregates

If there is a simultaneous fall in consumers disposal income as well as number of suppliers of a product in the market, the _________.

  1. equilibrium quantity will decrease

  2. equilibrium price will decrease

  3. equilibrium price will go up

  4. equilibrium quantity will increase
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

A fall in disposable income decreases demand (shifting the demand curve left), and a fall in the number of suppliers decreases supply (shifting the supply curve left). Both shifts lead to a decrease in equilibrium quantity.

Multiple choice economics circular flow of income and methods of calculating national income some macroeconomic identities national income accounting national income aggregates

From the following equation estimate disposal income (Y) when consumption (C) is Rs. 910.
C=Rs. 160+0.75Y$ _d$

  1. Rs. 1100

  2. Rs. 900

  3. 1000

  4. 800
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Using the equation C = 160 + 0.75Yd, substitute C = 910: 910 = 160 + 0.75Yd. Then 750 = 0.75Yd, so Yd = 750 / 0.75 = 1000.

Multiple choice economics circular flow of income and methods of calculating national income some macroeconomic identities national income accounting national income aggregates

From the following equation estimate Income (Y) consumption is Rs.1000 is _______.
C=Rs. 200+0.80Y$ _d$

  1. Rs. 1000

  2. Rs. 1100

  3. Rs. 900

  4. Rs. 800
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Using C = 200 + 0.80Yd, substitute C = 1000: 1000 = 200 + 0.80Yd. Then 800 = 0.80Yd, so Yd = 800 / 0.80 = 1000.

Multiple choice economics circular flow of income and methods of calculating national income some macroeconomic identities national income accounting national income aggregates

From the following equation estimate disposal income (Y) when consumption C=is Rs. 760 is ________.
C=Rs. 160+0.75Y$ _d$

  1. Rs. 1000

  2. Rs. 900

  3. Rs. 800

  4. Rs. 750
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Using C = 160 + 0.75Yd, substitute C = 760: 760 = 160 + 0.75Yd. Then 600 = 0.75Yd, so Yd = 600 / 0.75 = 800.