Refer to the Diagram for a Private Closed Economy

question 58

Multiple Choice

Refer to the diagram for a private closed economy. The MPC and MPS are

• A) 0.6 and 0.4, respectively.
• B) 0.7 and 0.3, respectively.
• C) both 0.5.
• D) both 0.7.

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Definitions:

Revenues

The income generated from normal business operations, typically from the sale of goods and services to customers.

Expenses

The depletion or expenditure of resources during a company's operational activities aimed at creating income.

Net Income

The ultimate earnings of a company, determined by subtracting all operational costs and governmental levies from its revenue.

Stockholders

Individuals or entities that own shares of stock in a corporation, thereby owning a portion of the company.