Chapter 10 - Determinants Of Aggregates Economics Solutions for Class 12 Commerce Economics

Chapter 10 - Determinants Of Aggregates

Economics Solutions for Class 12 Commerce Economics

Fill in the blanks with appropriate alternatives given in the brackets.

Match the following Group:

State whether the following statements are true or false.

1. Consumption expenditure is the only component of aggregate demand.

2. The difference between a country's exports and imports is termed as net earnings from foreign transactions.

3. Autonomous consumption is income elastic.

4. The equality between aggregate demand and aggregate supply determines the equilibrium level of employment.

5. At break even point Consumption (C) is equal to income (Y).

Define or Explain the following concept:

1) Autonomous Consumption

2) Aggregate Demand

3) Aggregate Supply

4) Effective Demand

Give reasons or explain.

1) Investment demand is not the sole determinant of aggregate demand.

2) Saving may be used in future for unforeseen contingencies.

3) There are many subjective factors determining consumption function.

4) Aggregate demand is a positive function of the level of employment and output.

5) The Propensity to Consume means consumption function.

Distinguish between:

1) Aggregate Demand and Aggregate Supply

2) Autonomous Investment and Induced Investment

3) Exports and Imports

4) Consumption and Saving

5) Consumption Function and Saving Function

Write Short notes on:

1) Effective Demand

2) Saving Function

3) Break-even Point

4) Average Propensity to Consume

5) Marginal Propensity to Consume

Answer the following questions

1) What are the determinants of Aggregate Demand (AD)?

2) What are the determinants of Aggregate Supply (AS)?

3) State J. M. Keynes' Psychological Law of Consumption.

4) What is autonomous consumption?

5) State the subjective factors determining consumption function?

State with reasons whether you agree or disagree with the following statements.

1) Aggregate demand depends only on the consumption expenditure.

2) Aggregate supply is influenced by the state of technology only.

3) Positive net earnings from foreign transactions add to aggregate demand.

4) At break-even point, consumption (C) is equal to income (Y).

5) Savings are negative before break-even point.

Answer in detail.

1) Explain the determinants of aggregate demand.

2) What is Aggregate Supply? Explain the determinants of Aggregate Supply.

3) Explain the equilibrium between Aggregate Demand and Aggregate Supply.

4) What are the objective factors influencing consumption function?

5) Give an idea about the subjective factors determining consumption function.