Following Is Consumption Schedules for Three Private Closed Economies

question 118

Multiple Choice

Following is consumption schedules for three private closed economies.DI signifies disposable income and C represents consumption expenditures.All figures are in billions of dollars. Refer to the above data.At an income level of $40 billion, the average propensity to consume:

• A)is highest in economy (1).
• B)is highest in economy (2).
• C)is highest in economy (3).
• D)cannot be determined from the data given.

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Definitions:

Overshooting

Exceeding a target or expected outcome, often referring to economic indicators or personal goals.

Undershooting

The failure to achieve a targeted goal or objective, often resulting in outcomes that fall short of expectations.

Reflecting Skills

Techniques used in communication that involve mirroring the content or emotions of what another person has said to show understanding and empathy.

Summarizing

The practice of briefly stating the main points of a piece of writing, conversation, or presentation in a concise form.