Suppose There Is an Increase in the Marginal Propensity to Spend

question 34

Multiple Choice

Suppose there is an increase in the marginal propensity to spend out of national income.The result will be

• A)a movement to the right along the AE curve.
• B)a movement to the left along the AE curve.
• C)an increase in the slope of the AE curve.
• D)a decrease in the slope of the AE curve.
• E)a parallel upward shift in the AE curve.

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Definitions:

Equivalence Principle

In physics, it states that gravitational and inertial forces are of a similar nature and often indistinguishable.

Entropy

In the context of thermodynamics, entropy is a measure of disorder or randomness in a system. In information theory, it represents the degree of uncertainty or unpredictability in data.

Individuation

A condition of psychological health resulting from the integration of all conscious and unconscious facets of the personality.

Psychic Energy

A concept in psychology referring to the energy within the psyche, responsible for thought, feeling, and behavior.