Question : Which of the following statement are true?

1. In a two sector economy, if consumption is equal to income, average propensity to save will be zero.
2. In a two sector economy if income is zero consumption will also be zero.

Question : Which of the following statement are true?

1. At breakeven point, income and consumption are equal.
2. Equality between AD and AS implies the equality between income and AD.

Question : Which of the following are true?

1. Circular flow of income does not takes place in case of closed economy. 
2. Physical flow involves exchange of goods and services.

Question : Which of the following statement are true?

1. When consumption function is C=40+0.8Y, savings will be equal to -40 at zero level of income.
2. As per above consumption function, MPS= 0.2 

Question : Which of the following are true?

1. Generation and distribution are the two phases in circular flow of income.
2. There are no exports in a closed economy.