If disposable income increases from $5 trillion to $6 trillion and, as a result, consumption expenditure increases from $7 trillion to $7.8 trillion, the MPC is
A) 1.0.
B) 6 ÷ 7 = 0.86.
C) 6 ÷ 7.8 = 0.77.
D) 5 ÷ 7 = 0.71.
E) 0.8.
E
You might also like to view...
Which of the following is one of the most widely followed stock indexes in the United States?
A) the Fortune 500 B) the Securities and Exchange Commission C) the Dow Jones Industrial Average D) the Chicago Mercantile Exchange
Studies have shown that in the 1980s the wage gap between college-educated workers and those with high school education or less
A. decreased dramatically. B. decreased slightly. C. remained unchanged. D. widened dramatically.
The opportunity cost of going to a movie is:
A) the money spent on the ticket only. B) all of the other movies that could have been seen instead. C) the time spent in the theater only. D) the next best use of the time and the money spent.
The resolution of Adam Smith’s diamond-water puzzle is based on the distinction between marginal and total utility.
Answer the following statement true (T) or false (F)