Which of the following best represents the consumption function?
A) consumption = autonomous consumption + (the marginal propensity to consume × disposable income)
B) consumption = disposable income - (autonomous consumption / the marginal propensity to consume)
C) consumption = disposable income × (1 / 1 - the marginal propensity to consume)
D) consumption = autonomous consumption + (the marginal propensity to consume × transfer payments) / disposable income
A
You might also like to view...
Free trade will affect a country's employment in different industries
Indicate whether the statement is true or false
Some of the promising approaches to reducing the natural rate of unemployment have to do with education, training, and job placement. What implementation problems do you anticipate?
What will be an ideal response?
What do Fannie Mae and Freddie Mac have in common?
A) They are both investment banks. B) Both firms issue bonds on behalf of the government. C) Both firms went out of business in the 2008 financial crisis. D) They are both pension funds. E) They are both government-sponsored mortgage lenders.
If a tax is imposed in a market in which demand is perfectly inelastic
A) the buyers pay the entire tax. B) the sellers pay the entire tax. C) the buyers and the sellers both pay a portion of the tax. D) neither the buyer nor the seller pays the tax.