If the Marginal Propensity to Save Is 0

question 94

Multiple Choice

If the marginal propensity to save is 0.15, the marginal propensity to consume:

• A) is 0.15.
• B) is 1.15.
• C) is 0.85.
• D) cannot be determined by the given information

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Definitions:

Audit Function

The process of examining financial records and transactions by a third party to ensure accuracy and compliance with accounting standards.

Financial Statements

Comprehensive reports created to present a company's financial performance, financial position, and cash flows over a specific period.

Audit Report

A formal statement issued by an auditor at the conclusion of an audit process, summarizing their opinion on an entity's financial statements.

Retained Earnings

The portion of net income not distributed as dividends but retained by the company for reinvestment or to pay debt.