Who among the following is likely to have the highest marginal propensity to consume out of current income?
a) a rational consumer who intends to behave strictly according to the permanent income hypothesis
b) a risk averse consumer facing a high degree of uncertainty
c) a low-income consumer facing borrowing constraints
d) a working age consumer looking forward to retirement
e) a wealthy parent who is currently accumulating funds to bequeath to his heirs
c) a low-income consumer facing borrowing constraints
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"Heteroskedasticity typically occurs in cross-sections, while serial correlation is typically observed in time-series data." Discuss and critically evaluate this statement
What will be an ideal response?
Which statement is false?
A. Germany pays higher manufacturing wage rates than the U.S. does. B. The United States pays the highest manufacturing wage rates in the world. C. Both Britain and Norway pay higher manufacturing wage rates than the United States. D. None of the statements are false.
You live in a world where the marginal rate of substitution of food for clothing is two and the price ratio between food and clothing is one. Your world also has labor and capital that has marginal products respectively of two and five. The price of capital is ten and the price of labor is 8. Finally, your world can transform two units of food into one unit of clothing or vice versa. Assuming that all the conditions of general equilibrium are present, what will happen in the various sectors of the economy to bring about general equilibrium?
What will be an ideal response?
The rising part of a perfectly competitive firm's ________ cost curve is the firm's short run ________ curve.
A. average fixed; demand B. average total; supply C. average variable; demand D. marginal; supply