In Figure 3-4 above, the marginal propensity to consume is
A) 500.
B) 2.5.
C) 0.6.
D) 0.4.
E) 1.5.
C
You might also like to view...
A one-time tax rebate, which is not expected to be extended in future years, will
A) have a significant positive effect on consumption and aggregate demand, with aggregate demand growing by a multiple of the tax rebate. B) have no effect on consumption and aggregate demand. C) increase aggregate supply and aggregate demand. D) have a moderately positive effect on consumption and aggregate demand.
The United States' first income tax was imposed during
(a) the American Revolutionary War (1763–1789). (b) the Civil War (1861–1865). (c) the 1930's Great Depression. (d) World War II (1939–1945).
A factor that would reduce the ability of the Social Security system to maintain current benefit levels with constant tax rates is
a. rapid real wage growth. b. reduced population growth. c. adoption of a "pay as you go" system. d. a slowdown in inflation.
What are the four main limitations of GDP accuracy?
(D) Depreciation, price level, distortion, and underground economy. (B) Nonmarket activities, underground economy, negative externalities, and quality of life. (C) Durable good, nondurable good, black market, and negative externalities. (D) Trough, peak, recession, and depression.