Let Real GDP =Y = Y_d, and the Consumption Function

question 85

Multiple Choice

Let real GDP =Y = Y_d, and the consumption function is C = $1,000 + .06Y. JWhat is the value of autonomous consumption (A) and what is the marginal propensity to consume (MPC) ?

• A) A = $600; MPC = 0.4
• B) A = $1,000; MPC = 0.6
• C) A = $1,600; MPC = 2.5
• D) A = $2,500; MPC = 0.6

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Definitions:

Zero-hour Contract

An employment agreement where the employer does not guarantee regular working hours, and the employee is only expected to work when called upon.

Compressed Workweek

A work schedule that allows an employee to work a full-time job in fewer days than the typical five-day workweek.

Mental Demands

The cognitive requirements placed on an individual by a job, including problem-solving, decision-making, and the application of knowledge.

Simplifying Jobs

The act of making occupational tasks less complex, increasing efficiency and reducing the likelihood of errors.