Explain consumption function with the help of diagram.

What are the determinants of investment function?

What are the factors on which MEC depends? Also give details on the factors which influence MEC.

Explain Marginal propensity to consume and multiplier, with the help of a diagram.

Draw a consumption table where autonomous consumption is Rs.200 and the marginal propensity to consume is .8. Make sure to start with an income level of Rs.0 and increase by Rs.100 each time up to an income level of Rs.400. Without completing the table any further determine the level of income where consumption and income are equal. Prove this algebraically.

Explain the concept of super multiplier.

Explain Multiplier with help of suitable diagram.

State the Relationship between rate of interest and Investment:

Explain the short and long run factors of MEC.

Derive the value of the multiplier assuming the basic form of the consumption function as C = a + bY where "a" is autonomous consumption and "b" is the marginal propensity to consume. You may assume a two-sector economy.

Use the table below (for a simple economy with no foreign sector or government) to answer the questions that follow.

(1) Income   (Y)	(2) Consumption       (C)	(3) Investment      (l)	(4) Aggregate Demand AD = C + 1 = Column(2) + Column(3)
0	30	(a)	50
300	300	20	(b)
400	(c)	20	410
500	480	20	500
600	(d)	20	(e)

Fill in the missing numbers in the spaces marked (a)-(c). Determine the consumption function, and use the result to fill in the remaining missing numbers (d)-(e). (f) Determine the equilibrium output level.

What are the factors that determine MEC?

Give an account of the classification and leakages of multiplier.