If the marginal propensity to consume was 0.75, it would mean that:
A. $0.75 of an additional $1 of individuals' after-tax income is spent on consumption.
B. $0.75 of an additional $1 of individuals' after-tax income is saved.
C. $0.25 of an additional $1 of individuals' after-tax income is spent on consumption.
D. None of these is true.
A. $0.75 of an additional $1 of individuals' after-tax income is spent on consumption.
You might also like to view...
The table shows short-run average total cost schedules for three plants of different sizes that a firm might build in the long run.Plant 1Plant 2Plant 3OutputATCOutputATCOutputATC10$1010$1510$20209201020153083073010409401040850105014509What is the long-run average total cost of producing 30 units of output?
A. $8 B. $9 C. $7 D. $10
Refer to Figure 14.1. Other things equal, an increase in the Fed's concern about deviations of inflation from the target inflation rate is best represented as a movement from
A) point X to point Z. B) point Z to point X. C) point Z to point Y. D) point Y to point X.
If income redistribution policy is based on the relative concept of poverty, the war on poverty
a. will be won quite soon. b. is, by definition, unwinnable. c. has not helped at all. d. has already been won.
In order to see how the labor market works as a whole, we need to add up all the:
A. demand curves of individual workers and the supply curves of individual firms to find market level demand and supply. B. supply curves of individual workers and the demand curves of individual firms to find market level supply and demand. C. observed equilibrium wages across all individual markets and take the weighted average. D. None of these statements is true.