The marginal propensity to consume is
A. That part of the average consumer dollar that goes to saving.
B. Always equal to 1.
C. The change in consumption divided by the change in disposable income.
D. The same as the spending multiplier.
Answer: C
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In the above figure, the short-run aggregate supply curve is SAS1. If the money wage rate increases, there is
A) an upward movement along SAS1. B) a downward movement along SAS1. C) a shift to SAS0. D) a shift to SAS2.
If additional information is not used when forming an optimal forecast because it is not available at that time, then expectations are
A) obviously formed irrationally. B) still considered to be formed rationally. C) formed adaptively. D) formed equivalently.
_____ is embodied in the notion of a social welfare function
a. Progressivism b. Socialism c. Utilitarianism d. Social insurance
Expansionary monetary policy increases the quantity of loans in an economy
a. True b. False Indicate whether the statement is true or false