If the Consumption Function Coincides with the 45- Degree Line

question 56

Multiple Choice

If the consumption function coincides with the 45- degree line, then we know that

• A)the marginal propensity to consume is greater than one.
• B)desired saving is zero at all levels of disposable income.
• C)desired consumption is constant at all levels of disposable income.
• D)desired consumption equals desired saving at all levels of disposable income.
• E)the marginal propensity to consume is less than one.

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Definitions:

Impoverished Children's IQ

The phenomenon suggesting that children raised in poverty may, on average, score lower on intelligence quotient (IQ) tests, potentially due to environmental factors and lack of access to resources.

Disadvantaged Contexts

Environments or situations where individuals have limited access to resources, opportunities, or services, impacting their quality of life and development.

Environmental Stimulation

Describes the process by which physical, social, and intellectual aspects of the environment encourage developmental processes in individuals.

Flynn Effect

A phenomenon observed as a substantial and long-sustained increase in intelligence test scores measured across the world over the 20th century.