If the Consumption Schedule Shifts Upward and the Shift Was

question 17

Multiple Choice

If the consumption schedule shifts upward and the shift was not caused by a tax change, the saving schedule

• A) will not shift.
• B) may shift either upward or downward.
• C) will shift downward.
• D) will also shift upward.

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Definitions:

Unit Elastic

A situation in demand or supply where the elasticity is exactly one, indicating that a change in price results in a proportionate change in the quantity demanded or supplied.

Total Revenue

The total amount of money received by a firm from selling its goods or services.

Price Elastic

Describes how sensitive the demand for a good or service is to changes in its price.

Income Elasticity

A measure of how much the demand for a good or service changes in response to a change in the income of consumers.