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Questions › CUET-PG › CUET-PG 2023 Shift 1 › Q84
4 marks, −1Macroeconomics › Consumption and investment › Tobin's q and the user cost of capitalEasyabout 1 min

CUET-PG 2023 Shift 1 Question 84: Consumption and investment

Tobin's q ratio refers to

  1. the ratio of the market value of the firm's assets to the cost of producing those assets
  2. the ratio of the cost of producing assets to the market value of the assets
  3. the ratio of the PBT (profit before taxes) to the market value of the firm's assets
  4. the ratio of the PBT (profit before taxes) to the cost of producing those assets

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Consumption and investment has come up 74 times in 7 exams since 2005.

What this question tests

This question is on Tobin's q and the user cost of capital, part of Consumption and investment in Macroeconomics.

Modern theories of investment based on the market value of capital and its rental cost.

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