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Determination of Income and Employment
Question
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If planned expenditure is more than planned output, what will be its effect on inventories?

Answer

Stock of inventories will decrease.

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Some More Questions From Determination of Income and Employment Chapter

What is Breakeven point?

What are the types of Propensity to consume?

How does MPC affect level of income?

Distinguish between APC and MPC, The value of which of APC and MPC can be greater than one and when?

State relationship between income and saving.

What is saving function (or Propensity to save)?