Table 9.1 $$\begin{array} { | l | c | }
\hline \begin{array} { c }
\text { Disposable Income } \
\text { (Billions of dollars per year) }
\end{array} & \begin{array} { c }
\text { Total Consumption } \
\text { (Billions of dollars per year) }
\end{array} \
\hline \text { \$0 } & \$ 50 \
\hline 200 & 210 \
\hline
\end{array}$$ What is the rate of saving when income equals $300 billion in Table 9.1?
A)Zero.
B)$50 billion.
C)$10 billion.
D)-$290 billion.

Question

Table 9.1 $$\begin{array} { | l | c | } 
\hline \begin{array} { c } 
\text { Disposable Income } \
\text { (Billions of dollars per year) }
\end{array} & \begin{array} { c } 
\text { Total Consumption } \
\text { (Billions of dollars per year) }
\end{array} \
\hline \text { \$0 } & \$ 50 \
\hline 200 & 210 \
\hline
\end{array}$$ What is the rate of saving when income equals $300 billion in Table 9.1?
A)Zero.
B)$50 billion.
C)$10 billion.
D)-$290 billion.

Quizplus · Accepted Answer

When income is $300 billion, consumption is $250 billion (since consumption increases by $160 for every $200 increase in income). Therefore, saving is $300 - $250 = $50 billion.

Table 91 What Is the Rate of Saving When Income Equals $300