(Table) When Disposable Income Increases from $1,000 to $1,200, What

question 89

Multiple Choice

(Table) When disposable income increases from $1,000 to $1,200, what is the value of the marginal propensity to save? $$\begin{array} { | c | c | } \hline \begin{array} { c } \text { Disposable } \\\text { Income }\end{array} & \text { Consumption } \\\hline \$ 1,000 & \$ 1,200 \\\hline \$ 1,200 & \$ 1,300 \\\hline \$ 1,400 & \$ 1,400 \\\hline \$ 1,600 & \$ 1,500 \\\hline \$ 1,800 & \$ 1,600 \\\hline\end{array}$$

• A) 0.5
• B) -0.5
• C) 1.5
• D) -1.5

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Definitions:

Overhead Cost Driver

A factor that influences or contributes to the overhead costs of a business.

Employee Time Ticket

A document that records the amount of time an employee spends on various tasks, used for payroll and accounting purposes.

Cost Driver

A factor that influences or contributes to the expense of certain business operations.

Direct Costs

Costs that can be directly attributed to the production of a specific good or service, such as raw materials and direct labor.