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Exhibit 8-1 Disposable Income and Consumption Data in Exhibit

Question 116

Multiple Choice

Exhibit 8-1 Disposable income and consumption data Exhibit 8-1 Disposable income and consumption data In Exhibit 8-1, when disposable income is increased from $2,000 to $3,000 to $4,000, A) total consumption increases by $1,000. B) the marginal propensity to consume remains constant. C) the marginal propensity to consume increases from 0.6 to 0.7. D) the marginal propensity to consume decreases from 0.8 to 0.7. E) the marginal propensity to consume decreases from 0.7 to 0.6. In Exhibit 8-1, when disposable income is increased from $2,000 to $3,000 to $4,000,


A) total consumption increases by $1,000.
B) the marginal propensity to consume remains constant.
C) the marginal propensity to consume increases from 0.6 to 0.7.
D) the marginal propensity to consume decreases from 0.8 to 0.7.
E) the marginal propensity to consume decreases from 0.7 to 0.6.

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