The Above Figure Shows the Saving Schedules for Economies 1

question 103

Multiple Choice

The above figure shows the saving schedules for economies 1, 2, 3, and 4.Which economy has the highest marginal propensity to consume?

• A)1
• B)2
• C)3

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Definitions:

Brand Loyalty

The tendency of consumers to continuously purchase products from the same brand instead of switching to competitors.

Entry Barriers

Obstacles that make it difficult for new competitors to enter a market or industry.

Substitute Products

Products that can serve as replacements for one another; when the price of one increases, the demand for the substitute is likely to increase.

Herfindahl Index

A measure of market concentration used to evaluate the level of competition within an industry, calculated by summing the squares of the market shares of all firms in the industry.