An Increase in Disposable Income Shifts

question 341

Multiple Choice

An increase in disposable income shifts

• A) both the consumption and savings functions upward.
• B) the consumption function upward and leads to a movement along the savings function.
• C) both the consumption and savings functions downward.
• D) neither the consumption function nor the savings function because it leads to a movement along both the consumption and savings functions.

---

Definitions:

ANOVA

A statistical method used to compare the means of three or more samples to determine if at least one of the sample means is significantly different from the others.

Assumptions

Premises or statements accepted as true without needing proof, used as the basis for reasoning, discussion, or calculation.

Normally Distributed

Refers to a probability distribution that is symmetric about the mean, showing that data near the mean are more frequent in occurrence than data far from the mean.

Equal Variances

A term referring to situations where different samples or populations have similar or identical variability or spread in their data.