BRIGHT RIDERS SCHOOL- ABUDHABI

ASSIGNMENTS

SUBJECT- ECONOMICS

CLASS - XII

DETERMINATION OF INCOME AND EMPLOYMENT

Aggregate demand and its components

VERY SHORT ANSWER TYPE QUESTIONS (1 MARK)

1.What is aggregate demand?

2.State the components of AD.
3.What is consumption function?
4.Define autonomous consumption.
5.Define marginal propensity to save.
6. What is the relation between APC and APS?
7.Define marginal propensity to consume.
SHORT ANSWER TYPE QUESTIONS (3-4 MARKS
8.Give the meaning of marginal propensity to save and average propensity to save. Can the value
of APS be negative? If yes, when?
9.Explain the concept AD using a suitable schedule and diagram.
10.Explain saving function with the help of schedule and diagram.
H.O.T.S.

11.Why can the value of MPC be not greater than one ?

12.The sum total of APC and APS is always equal to one, even when APC>1. Is it true?
13.How is aggregate demand different from market demand?
LONG ANSWER TYPE QUESTIONS (6 MARKS

14.Draw a diagram showing straight line consumption function. From it, how would you derive a
saving function? Explain diagrammatically, taking some hypothetical figures.
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