The Consumption Schedule Relates

question 126

Multiple Choice

The consumption schedule relates:

• A)consumption to the level of disposable income.
• B)saving to the level of disposable income.
• C)disposable income to domestic income.
• D)consumption to saving.

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Definitions:

Degree of Total Leverage

A financial ratio that measures the sensitivity of a company's earnings per share to fluctuations in its operating income, considering both operating and financial leverage.

Financial Risk

The possibility of losing money on an investment or business venture, including various types of risks like market risk, credit risk, and operational risk.

Business Risk

The exposure a company or investor faces due to uncertainties in the operating environment, impacting its profitability.

Contribution Margin

The selling price per unit, minus the variable cost per unit, indicating the contribution towards covering fixed costs and profit.