An Increase in Consumer Spending Based on an Increase in Income

question 69

Multiple Choice

An increase in consumer spending based on an increase in income is reflected by

• A) an upward rotation of the consumption function.
• B) an increase in the MPC.
• C) a downward shift in the consumption function.
• D) a movement up along the consumption function.

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Definitions:

Conditional Response

A learned response that becomes associated with a previously unrelated stimulus as a result of conditioning.

Classical Conditioning

A learning process that occurs when two stimuli are repeatedly paired: a response that is at first elicited only by the second stimulus is eventually elicited by the first stimulus alone.

Rescorla

A psychologist recognized for his work on associative learning and the contingency theory in classical conditioning.

Signal Relations

The association between different signals and what they represent, particularly in the context of communication systems or psychological conditioning.