_____ Is the Change in Consumption Associated with a Change

question 91

Multiple Choice

_____ is the change in consumption associated with a change in income.

• A) The average propensity to consume
• B) The marginal propensity to consume
• C) The average propensity to save
• D) The marginal propensity to save

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Definitions:

Cash

Currency and other liquid instruments in a financial system or on a company's balance sheet used for transactions or settling debts.

Inventory

The goods and materials that a business holds for the purpose of resale or production.

Credit

The trust which allows one party to provide money or resources to another party wherein the second party does not reimburse the first party immediately but promises either to repay or return those resources at a later date.

Cash Cycle

The period between the outlay of cash for the purchase of raw materials and the collection of cash from the sale of products, measuring how efficiently a company manages its working capital.