McqMate
| Q. |
Effective demand depends on - |
| A. | capital-output ratio |
| B. | output-capital ratio |
| C. | total expenditure |
| D. | supply price |
| Answer» D. supply price | |
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Explanation: Effective Demand is "the demand in which the consumer are able and willing to purchase at conceivable price" simply saying if the product price is low more will buy; but if the rates go high then the quantity of the demand goes down. Keynes used Iwo terms: Aggregate Demand Function or Price and Aggregate Supply Function or Price to explain the determination of effective demand. |
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