1. **If income increases, Keynesian theory suggests that total consumption will:**
- Remain constant
- Increase, but by less than the increase in income
- Decrease
- Increase by the same amount as income

2. **Autonomous consumption refers to consumption that:**
- Depends on investment
- Does not depend on income
- Depends only on income
- Depends on interest rates

3. **Actual investment differs from planned investment when:**
- There is no change in inventories
- Government spending decreases
- There are unexpected changes in inventories
- Businesses accurately forecast future demand

4. **In a simple economy, planned investment refers to:**
- The total spending by firms on capital goods and inventories
- Government expenditure on public projects
- The actual level of investment that occurs in an economy
- The level of investment firms intend to undertake

5. **In the Keynesian model, planned investment is determined mainly by:**
- Government spending
- The money supply
- The current account balance
- Interest rates and business expectations

6. **If businesses sell more than they expected, their actual investment will be:**
- Less than planned investment
- More than planned investment
- Unaffected
- Equal to planned investment

7. **If the marginal propensity to consume (MPC) is 0.6, what is the marginal propensity to save (MPS)?**
- 0.6
- 2.5
- 0.4
- 5/3

8. **If consumption exceeds income in a given period, it means that:**
- Investment is decreasing
- People are borrowing or using past savings
- The MPC is greater than 1
- There is a budget surplus

9. **The average propensity to consume (APC) is defined as:**
- C/Y
- C+S
- Y/C
- ΔC/ΔY

10. **According to Keynes, the most important determinant of consumption is:**
- Expectations about future inflation
- Interest rates
- Disposable income
- Government spending