If planned expenditure of household exceed the plant output of in an economy then it means that ????
1. Ex ante investment is greater than ex ante savings.
2. Aggregate supply is more than aggregate demand
3. MPS is zero
4. MPC is zero
Dear Student,
The correct answer is 3.MPS is zero, as MPS=0 when addition to the income is spent on the Consumption.
However, if you meant "planned" instead of "plant", then the answer would be- 1. Ex ante investment is greater than ex ante savings.
Regards
The correct answer is 3.MPS is zero, as MPS=0 when addition to the income is spent on the Consumption.
However, if you meant "planned" instead of "plant", then the answer would be- 1. Ex ante investment is greater than ex ante savings.
Regards