Marginal propensity to consume (MPC) is the fraction of extra income that a household spends on consumption.
Answer the following statement true (T) or false (F)
True
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Which of the following statements is FALSE?
A. Included in the firm's short-run production function are both fixed and variable inputs. B. An efficient firm can obtain more output than the production function shows. C. The production function shows the technical relationship between a firm's inputs and outputs. D. The production function presents the technically efficient methods of combining inputs to produce output.
Because the actual market-capitalist system is a combination of market processes and political processes,
A) it can only be managed appropriately by well-trained political economists. B) it is often unclear where to place the blame when things go wrong. C) political considerations will always ruin the market process. D) economic considerations will always ruin the political process.
The ratio of the percentage change in consumption of a good divided by the percentage change in income (as measured by GDP) is known as the
A) income elasticity of demand. B) income expansion path. C) demand elasticity equivalent. D) trade effectiveness.
Research supporting the new Keynesian model finds that prices are ________
A) slow to adjust to aggregate demand shocks B) changed very frequently C) changed only infrequently D) not as flexible as wages