If the MPC is three quarters,then an increase in disposable income will cause
A) consumption to rise by three times the increase in disposable income.
B) consumption to rise by four times the increase in disposable income.
C) consumption to increase,while saving decreases.
D) consumption to decrease,while saving increases.
E) consumption and saving both to increase,with consumption increasing more than saving.
Correct Answer:
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Q109: Over the last 20 years,our APS has
A)never
Q110: Which statement is true?
A)Saving can never be
Q111: An increase in interest rates results in
A)increased
Q112: Statement I.APC + APS = 1.
Statement II.MPC
Q113: When the APC is greater than one,
A)the
Q115: If we save 20 percent of our
Q116: If the APC is .6,we consume
A)4 percent
Q117: If the APS is .1,we save
A)1 percent
Q118: According to Friedman's "permanent income hypothesis,"
A)Consumption today
Q119: According to the permanent income hypothesis,households will
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