New Video by brainbrusher.
In this Video You are able to know about the relation of Income and Consumption, in other words the proportion of Planned Income (Y) which converted into Consumption (C) by the consumers in the economy during an accounting year.
Consumption is function of income or C=f(Y).
Propensity to consume, in economics, the proportion of total income or of an increase in income that consumers tend to spend on goods and services rather than to save. The ratio of total consumption to total income is known as the average propensity to consume; an increase in consumption caused by an addition to income divided by that increase in income is known as the marginal propensity to consume. Because households divide their incomes between consumption expenditures and saving, the sum of the propensity to consume and the propensity to save will always equal one.
Aggregate demand and related concepts class 12 | Components of Aggregate demand | aggregate demand and related concepts class 12
income determination and multiplier (K) class 12
short run equilibrium output, aggregate demand aggregate supply and related concepts in macroeconomics
Consumption function ; C = f(Y)
propensity to consume, Average Propensity to Consume (APC), Marginal Propensity to Consume (MPC),
Saving function ; S=f(Y)
propensity to Save, Average Propensity to Save (APS), Marginal Propensity to Save (MPS),
Investment Multiplier (K)
K= 1/1-MPC, K=1/MPS
K=Change in Income/Change in Investment,
consumption function class 12
concept of investment multiplier.
Inflationary gap, deflationary gap, Fiscal policy. deficit demand. AD AS equilibrium level.
Most important question for cbse Exam 2020-2021.
excess demand and deficient demand class 12
inflationary gap and deflationary gap class 12measures to correct deficient and excess demand
monetary policy macroeconomics fiscal policy macroeconomics Aggregate demand and its components.Propensity to consume and propensity to save (average and marginal).
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