If Y = $500 billion, autonomous consumption = $400 billion, and the marginal propensity to save = 0.20, then saving will equal:
A. ?$300 billion.
B. $300 billion.
C. -$80 billion.
D. $80 billion.
Answer: A
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During the post war period,
a. an economic slowdown occurred immediately following the Armistice. b. a vigorous boom began in 1919. c. the Federal Reserve followed a policy of keeping its discount rate below market rates. d. All of the above are correct. e. Only b and c are correct.
The profit maximizing output level for a perfectly competitive firm is always where
A. P = AVC. B. MC = ATC. C. MC = AVC. D. P = MC.
In a free market for depletable natural resources, any shortage where there is an excess of quantity demanded over quantity supplied must be
A. temporary. B. due to a price floor. C. the result of discovery of new deposits of the resources. D. due to a price ceiling.
Inflation is primarily a problem
a) because even low inflation rates severely hamper GDP growth b) for those who are heavily indebted c) when it is volatile and thus unpredictable d) because it is severely underestimated, especially when products are improving in quality e) for accounting and record-keeping, but it does not affect the actual trading of goods and services