IGNOU BECC-133 is a course under the Bachelor of Arts (BA) program offered by Indira Gandhi National Open University (IGNOU). To successfully complete the course and be eligible to appear for the exams in June 2024, students are required to submit the IGNOU BECC-133 SOLVED ASSIGNMENT 2023-24 for the academic year 2023-24. Below are the details of the IGNOU BECC-133 SOLVED ASSIGNMENT 2023-24:

Assignments FOR JULY 2023 AND JAN 2024 ADMISSION




IGNOU BECC-133 SOLVED ASSIGNMENT 2023-24 Submission: Students are advised to submit the IGNOU BECC-133 SOLVED ASSIGNMENT 2023-24 as per the specified schedule. The assignments must be submitted in soft copy/PDF format through the designated portal or email, as instructed by the university.

Guidelines for Preparing IGNOU BECC-133 SOLVED ASSIGNMENT 2023-24: While preparing the IGNOU BECC-133 SOLVED ASSIGNMENT 2023-24, students must adhere to the following guidelines:


1. (a) Explain the changes in the consumption function when government sector is introduced in the National income model.

When the government sector is introduced into the National Income model, it has a significant impact on the consumption function. The National Income model is an economic framework that represents the flow of goods, services, and money in an economy. The consumption function is a key component of this model, representing the relationship between disposable income and consumption expenditure by households.

With the introduction of the government sector, there are a few key changes that occur in the consumption function:

  1. Disposable Income: Disposable income is the income that households have available for spending after paying taxes. When the government sector is introduced, taxes are levied on households’ income to fund government expenditures. As a result, disposable income for households is reduced by the amount of taxes paid.
  2. Government Transfers: Governments often provide various forms of financial assistance or transfers to households, such as unemployment benefits, social security payments, and welfare programs. These transfers contribute to households’ disposable income and, consequently, influence their consumption patterns.
  3. Government Expenditure: The government spends money on public goods and services such as infrastructure, defense, education, and healthcare. This government expenditure can indirectly affect the consumption function. For example, increased government spending on infrastructure projects can lead to job creation and higher incomes, which in turn can boost consumption.
  4. Crowding Out Effect: The government often finances its expenditures through borrowing, which can lead to higher interest rates and reduce private sector spending. This phenomenon is known as the “crowding out” effect. Higher interest rates can make borrowing more expensive for households, leading to reduced consumption.
  5. Tax Multipliers: Changes in government taxation can affect household disposable income and consumption. Tax cuts, for instance, can increase disposable income and stimulate consumption, while tax hikes can have the opposite effect.
  6. Expectations: Households’ expectations about future government policies and economic conditions can also influence their consumption decisions. If households expect higher taxes or reduced government transfers in the future, they might adjust their current consumption patterns accordingly.

In summary, the introduction of the government sector into the National Income model brings about changes in the consumption function due to alterations in disposable income, government transfers, government expenditure, the crowding out effect, tax multipliers, and households’ expectations. These changes highlight the interconnectedness of different sectors within an economy and how government policies can influence consumer behavior and overall economic activity.

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