Check sibling questions

We know that

If We calculate National Income by Expenditure format


National income = Consumption Expenditure + Investment Expenditure

National income = C + I


Now, we can calculate C by using Consumption function formula


it is represented by

C =Ĉ +b(Y)


C= Total Consumption

Ĉ = Autonomous Consumption




Now, we can calculate National income as follows

National income=C+I

National income=Ĉ +b(Y) +I


Example 31

Find national income from the following:

Autonomous Consumption = Rs 100

Marginal propensity to consume = 0.8

Investment = Rs 50

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NCERT Questions

No questions in this part

Other Books

Question 1

An economy is in equilibrium.

Calculate National Income from the following:

Ĉ = Autonomous Consumption = 100

MPS = 0.2

Investment = 200

View Answer

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Maninder Singh

CA Maninder Singh is a Chartered Accountant for the past 13 years and a teacher from the past 17 years. He teaches Science, Economics, Accounting and English at Teachoo