The marginal propensity to consume is calculated by dividing the change in consumer spending by the change in disposable income.
Answer the following statement true (T) or false (F)
True
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If the consumption function is C = 90 + 0.75y, then the marginal propensity to save is
A) 0.25. B) 0.75. C) 67.5. D) 90.
Under the gold standard of the Great Depression, any country experiencing a balance of payment deficit was expected to finance those deficits by exporting gold
The loss of gold should be followed by contractionary monetary policy, reducing demand and causing prices to fall. All countries operating under the gold standard followed these rules of the game throughout the Great Depression. Indicate whether the statement is true or false
If you returned a $5 Federal Reserve note to the Fed, you could receive: a. $5 in silver
b. $5 in gold. c. 5 one-dollar bills. d. 10 one-dollar bills. e. a small gold bar.
Refer to the diagram in which the downsloping lines are budget lines and I 1 , I 2 , and I 3 comprise an indifference map. The combinations of products M and N indicated by points 1, 3, and 5 are such that:
A. all three imply the same level of utility.
B. 1 and 5 imply a higher level of utility than does 3.
C. 3 implies a higher level of utility than does 1 or 5.
D. the person is indifferent among the three combinations.