The consumption function shows the relationship between:
A. planned consumption expenditures and disposable income.
B. permanent income and savings.
C. business inventory and real GDP.
D. aggregate demand and aggregate consumption.
Answer: A
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During last year the price of regular unleaded gasoline in Oakland, California increased 11.0 percent. If the price elasticity of demand for gasoline was 0.13, the price hike means that the quantity demanded decreased by
A) 1.43 percent. B) 8.46 percent. C) 0.16 percent. D) 4.31 percent. E) 6.46 percent.
The gains from specialization and trade are based on absolute advantage
a. True b. False Indicate whether the statement is true or false
Critics of markets that are characterized by firms that sell brand name products argue that brand names encourage consumers to pay more for branded products that
a. have elastic demand curves. b. are very different from generic products. c. are indistinguishable from generic products. d. consumer-advocate groups have found to be inferior.
The regular earnings profile of an individual throughout his or her lifetime is
A. income-in-kind. B. the Lorenz curve. C. the age-earnings cycle. D. wealth.