Here Is a Consumption Function: C = C₀ + MPC(Y_d)

question 42

Multiple Choice

Here is a consumption function: C = C₀ + MPC(Y_d) .If C₀ = $200,then we know that

• A) if Y_d is zero,C will be $200.
• B) when Y_d rises,C rises by $200.
• C) when Y_d falls,C falls by MPC times C₀.
• D) C will always equal C_0.

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Definitions:

Social Stratification

The hierarchical arrangement of individuals or groups in society based on wealth, power, status, or other criteria.

High Mobility

Refers to the ability of individuals, goods, or information to move or be moved quickly and easily within or across geographical, social, or digital spaces.

Equality of Opportunity

The principle that all individuals should have the same opportunities to achieve success and advancement, without discrimination based on race, gender, class, or other irrelevant factors.

Equality of Condition

An ideal state wherein all individuals have the same access to resources, opportunities, and rights, eliminating disparities based on socio-economic status or other attributes.