The Marginal Propensity to Import Is the That Is Spent

question 470

Multiple Choice

The marginal propensity to import is the that is spent on imports.

• A) fraction of an increase in real GDP
• B) fraction of an increase in potential GDP
• C) total amount of real GDP
• D) total amount of potential GDP

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Definitions:

Account Entry

An accounting record that logs a financial transaction in the books of accounts, impacting the balance sheet and/or income statement.

Debt Ratio

A financial ratio that measures the extent of a company’s leverage, computed by dividing total liabilities by total assets.

Financial Leverage

The use of borrowed funds to increase the potential return of an investment, which also increases the risk.

Posting Reference Column

A column in journals and ledgers where account numbers related to specific transactions are recorded for tracking purposes.