Refer to the information provided in Figure 23.1 below to answer the question(s) that follow. Figure 23.1
-Refer to Figure 23.1. A decrease in the MPS
A) makes the consumption function flatter.
B) makes the saving function flatter.
C) shifts the consumption function upward.
D) shifts the saving function downward.

Question

Refer to the information provided in Figure 23.1 below to answer the question(s) that follow.  Figure 23.1
-Refer to Figure 23.1. A decrease in the MPS
A) makes the consumption function flatter. 
B) makes the saving function flatter. 
C) shifts the consumption function upward. 
D) shifts the saving function downward.

Quizplus · Accepted Answer

A decrease in the MPS means that households save less out of their disposable income, resulting in a flatter saving function.

Refer to the Information Provided in Figure 23