Given the Following Traffic Flows, in Hundreds of Cars Per

question 47

Multiple Choice

Given the following traffic flows, in hundreds of cars per hour, what is the maximum traffic flow from Town 1 to Town 7?

• A)max flow = 4 units
• B)max flow = 6 units
• C)max flow = 3 units
• D)max flow = 9 units

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Definitions:

Capital Formation

The process of building up the stock of physical and financial assets in an economy, often through investment in productive assets.

Autonomous Consumption

The level of consumption that occurs when income is zero; it represents the expenditures that consumers must make even when they have no income.

Induced Consumption

Consumer spending that increases when income increases, and decreases when income decreases, reflecting behavioral responses to changes in income.

Disposable Income

The amount of money left for households to use on saving and spending after income taxes are covered.