Class 12 Macro Economics - Chapter Determination of Income and Employment NCERT Solutions | What do you understand by ‘paramet

What is the difference between ex ante investment and ex post investment?

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 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?

Are fiscal deficits inflationary?

Discuss the issue of deficit reduction.

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

Distinguish between the nominal exchange rate and the real exchange rate. If you were to decide whether to buy domestic goods or foreign goods, which rate would be more relevant? Explain.

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.

Give the relationship between the revenue deficit and the fiscal deficit.

In the above example, if exports change to X = 100, find the change in equilibrium income and the net export balance.

Are the concepts of demand for domestic goods and domestic demand for goods the same?

In a single day Raju, the barber, collects Rs 500 from haircuts; over this day, his equipment depreciates in value by Rs 50. Of the remaining Rs 450, Raju pays sales tax worth Rs 30, takes home Rs 200 and retains Rs 220 for improvement and buying of new equipment. He further pays Rs 20 as income tax from his income. Based on this information, complete Raju’s contribution to the following measures of income (a) Gross Domestic Product (b) NNP at market price (c) NNP at factor cost (d) Personal income (e) Personal disposable income.

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