Consumption smoothing is the idea that:
A) you can save your income as a child to fund your retirement
B) people prefer to have a constant salary over their lifetime
C) the government intervenes to insure that salaries don't change, but remain smooth to enable easier decision making
D) you can borrow when your income is low and pay back when your income rises
Correct Answer:
Verified
Q23: The net export component of aggregate demand
Q24: The multiplier effect refers to:
A) the total
Q25: If the MPW increases, the multiplier will:
A)
Q26: The portion of unemployment that is due
Q27: If the multiplier is 4, a $10
Q29: The formula for the multiplier is:
A) 1/MPC
B)
Q30: The level of private sector investment will
Q31: If consumption is $25 000 when income
Q32: An increase in the rate of interest
Q33: The Department of Defence closes its headquarters
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