In the above table, the average propensity to save when disposable income is $5,000 is
A. 0.2.
B. 0.0.
C. -0.1.
D. 0.1.
Answer: B
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A temporary increase in the price of oil would
A) increase both short-run and long-run aggregate supply. B) decrease both short-run and long-run aggregate supply. C) increase short-run aggregate supply and decrease long-run aggregate supply. D) decrease short-run aggregate supply and leave long-run aggregate supply unchanged.
Indifference curves are convex to the origin because of:
A) transitivity of consumer preferences. B) the assumption of a diminishing marginal rate of substitution. C) the assumption that more is preferred to less. D) the assumption of completeness. E) none of the above
Consider the production possibilities curve for an economy producing only two commodities wheat (represented on the X axis) and wine (represented on the Y axis). A movement up along the production possibilities curve [PPC] will imply:
a. an increase in wheat production. b. an increase in both wheat and wine production. c. a decline in both wheat and wine production. d. an increase in wine production. e. no change in either wheat or wine production.
Economists use the equation ?TC/?q to calculate ______.
a. total product b. marginal product c. marginal cost d. average cost