CBSE 2020 Class 12 Economics Outside Delhi Set 3

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Question : 3 of 7
 
Marks: +1, -0
Given the following information, state whether the economy is in equilibrium or not:
 S.No.  Particulars  Amount
 (i)  Autonomous Consumption & Investment Expenditure (A)  â‚¹ 700 crores
 (ii)  Marginal Propensity to Consume (MPC)  0.8
 (iii)  National Income  â‚¹ 4,000 crores
Solution:
The economy is in equilibrium when AD=AS(Y)
Autonomous consumption and Investment expenditure =₹700 crores
Marginal propensity to consume (MPC) =0.8
National Income (Y)=₹4,000 crores
=(C)+MPC(b)×Y
=700+0.8×4,000
=700+3,200=3,900
=₹3,900 crores
( ₹3,900 crores is not equal to ₹4,000 crores)
The economy is not in equilibrium.
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