Class 12 Macro Economics - Chapter Determination of Income and Employment NCERT Solutions | What is the difference between ex ante i

Explain ‘Paradox of Thrift’.

Measure the level of ex-ante aggregate demand when autonomous investment and consumption expenditure (A) is Rs 50 crores, and MPS is 0.2 and level of income (Y) is Rs 4000 crores. State whether the economy is in equilibrium or not (cite reasons).

What do you understand by ‘parametric shift of a line’? How does a line shift when its (i) slope decreases, and (ii) its intercept increases?

What is ‘effective demand’? How will you derive the autonomous expenditure multiplier when price of final goods and the rate of interest are given?

What is marginal propensity to consume? How is it related to marginal propensity to save?

Explain why public goods must be provided by the government.

Differentiate between balance of trade and current account balance.

What are the four factors of production and what are the remunerations to each of these called?

What is a barter system? What are its drawbacks?

What is the difference between microeconomics and macroeconomics?

Distinguish between revenue expenditure and capital expenditure.

What are official reserve transactions? Explain their importance in the balance of payments.

Why should the aggregate final expenditure of an economy be equal to the aggregate factor payments? Explain.

What are the main functions of money? How does money overcome the shortcomings of a barter system?

What are the important features of a capitalist economy?

In the above question, calculate the effect on output of a 10 per cent increase in transfers, and a 10 per cent increase in lump-sum taxes. Compare the effects of the two.

Would the central bank need to intervene in a managed floating system? Explain why.

Discuss the issue of deficit reduction.

What do you understand by G.S.T? How good is the system of G.S.T as compared to the old tax system? State its categories.

Calculate the open economy multiplier with proportional taxes, T = tY, instead of lump-sum taxes as assumed in the text.

What is a barter system? What are its drawbacks?

Explain the automatic mechanism by which BoP equilibrium was achieved under the gold standard.

What are official reserve transactions? Explain their importance in the balance of payments.

Are fiscal deficits inflationary?

What are the important features of a capitalist economy?