Which of the following statements is true?

Statement 1- Ex-ante savings refers to the amount of savings which is planned to be saved at different levels in an economy.

Statement 2- Break even point refers to the point at which consumption is equal to the investment.

Only statement 1 is true

The correct answer is Option 1: Only statement 1 is true

Statement 1: Ex-ante savings refers to the amount of savings which is planned to be saved at different levels in an economy. This is true. Ex-ante savings refers to the planned or intended savings that individuals or the economy as a whole aim to save at various levels of income.

Statement 2: Break-even point refers to the point at which consumption is equal to the investment. This is incorrect. The break-even point typically refers to the level of income where total consumption equals total income, meaning savings are zero. In the context of the Keynesian model, it is the point where the savings function intersects the consumption function, indicating no net savings or dissavings. It does not directly relate to investment.