Macro: Income Determination: Class 12 Previous Year Questions

Macro: Income Determination questions asked in CBSE board exams

Repeated questions first. Open the free app to see each question as it appeared in the paper, with its marking scheme.

1. (A) Read the following statements - Assertion (A) and Reason (R). Choose one of the correct alternatives given below : Assertion (A) : At the break-even level of income, the value of Average Propensity to Consume (APC) is zero. Reason (R) : Sum of Average Prop…
   Board 20231 markAssertion-ReasonRepeated: 2023,2025
2. The Aggregate Demand (AD) curve lies parallel to consumption curve, indicating that both have _________. 1 (Choose the correct option to fill in the blank) (A) same components (B) different slope (C) same slope (D) inverse relationship
   Board 20261 markMCQ
3.  16. (A) “Income of an economy increased from ` 20,000 to ` 50,000 crore. Savings of the economy increased from ` 2,000 crore to ` 10,000 crore.” (i) Calculate Average Propensity to Consume (APC) and Average Propensity to Save (APS), before and after the rise…
   Board 20266 markslong answer
4.  16. (A) (I) Estimate the value of subsistence level of consumption expenditure from the following data about an economy which is in equilibrium : 3 (i) National Income (Y) = ` 1,200 crore (ii) Marginal Propensity to Save (MPS) = 0.20 (iii) Investment Expendi…
   Board 20266 markslong answer
5. In an economy, when __________ is insufficient to achieve the level of output corresponding to the full employment, the difference is termed a deflationary gap. (Choose the correct option to fill in the blank) 1 Options : (A) ex-ante Aggregate Demand (B) ex-po…
   Board 20261 markMCQ
6.  1. Choose the correct consumption function from the options given below with reference to the illustrated given diagram. 1 { } 4   : (A) C = 100 + 0.7Y (B) C = 100 + 0.8Y (C) C = 100 – 0.7Y (D) C = 100 – 0.8Y  :     …
   Board 20261 markMCQ
7. (a) In an economy ; C = 200 + 0.75 Y (where C is consumption expenditure and Y is National Income). Investment expenditure is 4,oo0 Crore. Calculate the following : (i) Equilibrium level of income. (i) Total consumption expenditure at equilibrium income level.…
   Board 20254 markscase-based
8. To arrive at the value of equilibrium level of income, there must exists an equality between ex-ante and ex-ante (Choose the correct option to fill up the blank) (i) Aggregate Demand, Aggregate Supply (i)Aggregate Demand, Savings (iii) Aggregate Demand, Invest…
   Board 20251 markMCQ
9. In the Keynesian Economics, starts from the origin and is always drawn at an angle of 45°. (Choose the correct option to fill up the blank) (A) Consumption curve (B)Aggregate demand curve (C) Reference line (D) Investment curve 3/Page 4. (A)(A)(R) (R),(A) (B) …
   Board 20251 markMCQ
10. Suppose for an economy, government proposes project for construction of expressways with an incremental investment of 1200 crore. Assuming, 80% of increase in income is spent on consumption. Estimate the following on the basis of above information : (a) Change…
    Board 20254 marksshort answer
11. Suppose, the saving curve of an economy makes an intercept at a negative value of 50 crores. In the economy, 20% of an increase in income is saved. In the light of above context, identify the value of investment multiplier (K). Options : (A) 2 (B) (C) 10 () c0…
    Board 20251 markMCQ
12. Read the following statements carefully : 1 Statement 1 : If in an economy the level of income increases ( Y), it will always proportionately increase the level of consumption ( C). Statement 2 : Marginal Propensity to Consume (MPC) and Marginal Propensity to …
    Board 20241 markMCQ
13. Read the following statements carefully : 1 Statement 1 : A consumption function describes the relationship between consumption and savings. Statement 2 : Consumption function consists of two components autonomous consumption and induced consumption. In the li…
    Board 20241 markMCQ
14. Page 10 14. (H$) `{X nyU© amoµOJma ñVa na, A§{V_ dñVwAm| H$s dmñV{dH$ _m±J A§{V_ dñVwAm| Ho$ dmñV{dH$ CËnmXZ go H$_ hmo, Vmo Bggo _mbgyMr (Inventory) H$m AZno{jV g§M` hmo gH$Vm h¡ & h¢ ? AnZo CÎma Ho$ g_W©Z _| _mÝ` H$maU Xr{OE & 4 AWdm Page 11 11. (a) Accommod…
    Board 20244 marksshort answer
15. (a) "In an economy ex-ante Aggregate Demand is more than ex-ante Aggregate Supply." Explain its impact on the level of output, income and employment. OR (b) For a hypothetical economy, assuming there is an increase in the Marginal Propensity to Consume (MPC) f…
    Board 20234 marksshort answer
16. Describe the adjustment mechanism, if ex-ante savings are less than ex-ante investments.
    Board 20234 marksshort answer
17. (H$) `{X {Zdoe JwUH$ H$m _yë` = 4 VWm A~MV = ( ) 60 h¡, Vmo {ZåZ{b{IV _| go ghr ~MV \$bZ H$s nhMmZ H$s{OE : 1 (a) S = ( ) 60 + 0·25 Y (b) S = ( ) 60 + 0·75 Y (c) S = ( ) 60 + 0·20 Y (d) S = ( ) 60 + 0·60 Y AWdm (I) {XE JE Cn^moJ \$bZ C = 205 + 0·9 Y Ho$ {bE, {…
    Board 20231 markMCQ
18. nhMm{ZE {H$ {ZåZ{b{IV _| go H$m¡Z-gm g_rH$aU gË` h¡ ? (ghr {dH$ën H$m M`Z H$s{OE) 1 (a) MPC + MPS = 0 (b) MPC + MPS = 1 (c) MPC + MPS > 1 (d) MPC + MPS <
    Board 20231 markMCQ
19. (a) Calculate equilibrium level of income for a hypothetical economy, for which it is given that : (i) Autonomous Investments (I·) = R 2,500 crores, and (ii) Consumption Function; C = 1000 + 0.8Y where C = Consumption and Y = Income OR (b) Calculate, change in…
    Board 20221 markvery short
20. Calculate the Equilibrium level of Income for an imaginary economy, if it is given that : (a) Consumption function, C = 500 + 0·80 Y where C = Consumption, Y = Income (b) Autonomous Investments (Io) = < 1,000 crore
    Board 20221 markvery short

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