If the Savings Function Is of the Form S =

question 11

Multiple Choice

If the savings function is of the form S = - 200 + (0.1) YD and the marginal income tax rate is t = 0.2, an increase in income of 200 will increase consumption by

• A)180
• B)144
• C)80
• D)72
• E)20

Understand the concepts of interstate banking and its legality.

Analyze the role and impact of financial regulations and innovations on banking and financial services.

Differentiate between true money and substitutes like credit cards in terms of their economic roles.

Realize the significance of money in facilitating transactions and overcoming the limitations of barter.

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Definitions:

Common Shares

Equity securities that signify ownership in a corporation and entitle the holder to a vote at shareholders' meetings and to receive dividends.

Preferred Shares

A class of ownership in a corporation that has a higher claim on its assets and earnings than common shares, often paid dividends before common shareholders.

Treasury Shares

Previously outstanding shares repurchased by a corporation that are not canceled or restored to unissued status.

Repurchased Shares

Stocks that have been bought back by the issuing company from shareholders, reducing the amount of outstanding shares on the market.