In the Keynesian model, the consumption function is given by C = a + bY, where 'b' represents: MCQ with Answer and Explanation

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In the Keynesian model, the consumption function is given by C = a + bY, where 'b' represents:

A. Average propensity to consume

B. Marginal propensity to consume

C. Autonomous consumption

D. Marginal propensity to save

Answer: Option B

Solution (By JKSSB Mock Tests)

In the consumption function C = a + bY, 'a' is autonomous consumption and 'b' is the marginal propensity to consume (MPC).

This question belongs to: Economy GK Economy Set 1

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The 'Letter of Credit' in foreign trade is issued by:

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C. the importer's bank

D. the customs authority

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Correct Answer: Option C

Explanation:
A letter of credit is issued by the importer's bank guaranteeing payment to the exporter.

This question belongs to: Economy GK Economy Set 1

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Correct Answer: Option D

Explanation:
Revenue deficit = Revenue expenditure − Revenue receipts. It shows the shortfall in revenue receipts to meet revenue expenditure.

This question belongs to: Economy GK Economy Set 1

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Correct Answer: Option D

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