One Can Determine the Amount of Any Level of Total

question 113

Multiple Choice

One can determine the amount of any level of total income that is consumed by

• A) multiplying total income by the slope of the consumption schedule.
• B) multiplying total income by the APC.
• C) subtracting the MPS from total income.
• D) multiplying total income by the MPC.

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Definitions:

Cash Payments

Outflows of cash from a company to settle debts, purchase goods or services, or make investments.

Cash Account

An account recording the amounts of cash received and paid out in transactions.

Credit

A financial term denoting the provision of money, goods, or services with the expectation of future payment.

Consuming Goods

The action of using up goods or products, thereby reducing inventory.