If the Marginal Propensity to Consume Is 0

question 112

Multiple Choice

If the marginal propensity to consume is 0.9, it would mean that:

• A) consumers spend $9 out of every $10 of additional disposable income.
• B) consumers save $9 out of every $10 of additional disposable income.
• C) consumers spend $1 out of every $10 of additional disposable income.
• D) consumers spend $9.90 out of every $10 of additional disposable income.

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Definitions:

Dyslexia

A type of specific learning disorder in which people show a marked impairment in the ability to recognize words and to comprehend what they read.

Enuresis

A condition characterized by involuntary urination, especially by children at night.

Methylphenidate

A stimulant medication commonly used to treat attention-deficit hyperactivity disorder (ADHD) and narcolepsy, known commercially as Ritalin among others.

Stimulant

A substance that raises levels of physiological or nervous activity in the body, often used to increase alertness, attention, and energy.