Assume the Consumption Function Is of the Form C =

question 9

Multiple Choice

Assume the consumption function is of the form C = 200 + (0.75) YD and the income tax rate is t = 0.2.What would be the effect of an increase in government transfers of 200 ?

• A)an increase in income of 800
• B)an increase in income of 500
• C)an increase in income of 375
• D)an increase in income of 300
• E)an increase in income of 125

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Definitions:

Observations

Data points or values collected through measurement or research in a study.

Modal Class

The category or interval in a set of data with the highest frequency, often used in analyzing categorical or grouped numerical data.

Histogram

A graphical representation of data using bars of different heights, where each bar groups numbers into ranges, showing the frequency of data within each range.

Observations

Individual pieces of data collected during a study or experiment.