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        | CSS  :: Equilibrium Of National Income |  | 
	 
 
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                | 1. | Which shows equilibrium of national income |  
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				| A. | Consumption = investment | B. | Saving = Investment |  
				 				 | C. | Saving < investment | D. | Saving > Investment |  
                        
                        
                            Answer: Option B Explanation:    |  
 
            
            
                | 2. | This may cause an increase in national income: |  
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				| A. | Rise in exports | B. | Rise in imports |  
				 				 | C. | Fall in consumer spending | D. | Increase in saving |  
                        
                        
                            Answer: Option A Explanation:    |  
 
            
            
                | 3. | If C = 200 and I = 40 then Y will equal: |  
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                            Answer: Option B Explanation:    |  
 
            
            
                | 4. | Consumption is a function of: |  
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				| A. | Saving | B. | Investment |  
				 				 | C. | Income | D. | None of these |  
                        
                        
                            Answer: Option C Explanation:    |  
 
            
            
                | 5. | Which one is investment in economics? |  
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				| A. | Building a factory | B. | Buying shares in stock exchange |  
				 				 | C. | Depositing money in bank | D. | Depositing money in housing society |  
                        
                        
                            Answer: Option A Explanation:    |  
 
            
            
                | 6. | Marginal propensity to consume (MPC) is: |  
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				| A. | Total income spent on consumption | B. | Ratio of total income consumed |  
				 				 | C. | Ratio of additional income consumed | D. | Consumption divided by saving |  
                        
                        
                            Answer: Option C Explanation:    |  
 
            
            
                | 7. | Which of the following world increase national income: |  
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				| A. | Increase in taxation | B. | Increase in savings |  
				 				 | C. | Increase in Govt. spending | D. | Decrease in consumption spending |  
                        
                        
                            Answer: Option C Explanation:    |  
 
            
            
                | 8. | Which of the following is a withdrawal from the circular flow of income stream: |  
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				| A. | Investment | B. | Subsidies |  
				 				 | C. | Taxation | D. | Consumption |  
                        
                        
                            Answer: Option C Explanation:    |  
 
            
            
                | 9. | Aggregate demand is: |  
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				| A. | Aggregate saving | B. | Aggregate investment |  
				 				 | C. | Aggregate income | D. | Aggregate expenditure |  
                        
                        
                            Answer: Option D Explanation:    |  
 
            
            
                | 10. | To find net national product, depreciation is: |  
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				| A. | Added to GNP | B. | Subtracted from GNP |  
				 				 | C. | Multiplied with national income | D. | Has no role in national accounting |  
                        
                        
                            Answer: Option B Explanation:    |  
 
 
			
			
 
 
 
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