When the Consumption Function Lies Below the 45° Line, Households

question 73

Multiple Choice

When the consumption function lies below the 45° line, households

• A)are dissaving.
• B)spend all of any increase in disposable income.
• C)consume more than their disposable income.
• D)save all of any increase in disposable income.
• E)are saving some portion of their disposable income.

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Definitions:

Warlike

Having or showing a propensity for conflict or warfare; aggressive and militant in nature.

Minimal Intergroup

A concept in social psychology examining the minimal conditions required for discrimination to occur between groups.

Paradigm

A distinct set of concepts or thought patterns, including theories, research methods, postulates, and standards for what constitutes legitimate contributions to a field.

Inevitability

The quality of being certain to happen; an unavoidable event or outcome.