As disposable income rises:
a. consumption falls, but not by as much as the disposable income rises.
b. the average propensity to consume increases.
c. saving falls as a percentage of disposable income.
d. the average propensity to consume remains unchanged.
e. saving rises as a percentage of disposable income.
e
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"An increase in the real interest rate increases the quantity of investment." Is the previous statement correct or incorrect?
What will be an ideal response?
An increase in autonomous spending is sure to reduce the real money supply when
A) the economy is in the liquidity trap. B) the IS curve is vertical. C) the economy is at full employment. D) velocity is constant.
Since being originally set in 1913, bank reserve requirements have
A) not been changed. B) been changed only once. C) been changed on numerous occasions. D) been changed on a daily basis.
The production period in which at least one input is fixed in quantity is the
A) production run. B) long run. C) short run. D) planning horizon.