The Marginal Propensity to Save Shows _____

question 50

Multiple Choice

The marginal propensity to save shows _____.

• A) the extra saving generated by one unit of extra income
• B) the proportion of income that is spent on consumption
• C) the proportion of total income that is saved by an individual
• D) the extra savings by households when interest rates increase

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Definitions:

Changes in Equity

Changes in equity refer to the adjustments in the value of a company's equity over a specific period due to transactions with owners, issuance or repurchase of shares, profits or losses, and dividends.

Statement of Income

A financial document that shows a company's revenues, expenses, and profits over a specific period, highlighting the company's operating performance.

Share Capital

The amount of money that shareholders invest in a company in exchange for shares of ownership.

Statement of Cash Flows

a financial statement that shows how changes in balance sheet accounts and income affect cash and cash equivalents, and breaks the analysis down to operating, investing, and financing activities.