Which of the following statements is TRUE?

A) consumption + saving = disposable income
B) consumption + saving = personal income
C) consumption - investment = disposable income
D) consumption - saving = personal income


Answer: A) consumption + saving = disposable income

Economics

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Other things constant, a lowering of interest rates on used car loans would tend to

A) reduce the demand for used car loans. B) increase the demand for used car loans. C) increase the supply of used car loans. D) reduce the supply of used car loans. E) do none of the above.

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If workers and employers base their wages on an inflation forecast that turns out to be correct,

What will be an ideal response?

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In a market where negative externalities are associated with consumption and production, the equilibrium will not be efficient because:

A. Too few resources will be allocated towards producing the good B. Firms will shut down until costs are reduced C. Costs of production will, on average, be too high D. Too many resources will be allocated towards producing the good

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If two firms produce the same product but have different supply curves,

A) this would indicate that some other variable differs across the two firms. B) this would indicate that all variables are the same across the two firms. C) this would indicate that one or both of the firm's managers are misinformed. D) this would indicate a need for government regulation.

Economics