Refer to the Given Consumption Schedules

question 81

Multiple Choice

Refer to the given consumption schedules. DI signifies disposable income and C represents consumption expenditures. All figures are in billions of dollars. Suppose that consumption decreased
By $2 billion at each level of DI in each of the three countries. We can conclude that the

• A) marginal propensity to consume will remain unchanged in each of the three countries.
• B) marginal propensity to consume will decline in each of the three countries.
• C) average propensity to save will fall at each level of DI in each of the three countries.
• D) marginal propensity to save will rise in each of the three countries.

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Definitions:

Assembly Line

A manufacturing process in which parts are added to a product in a sequential manner to create a finished product more efficiently.

Division of Labor

The assignment of different parts of a manufacturing process or task to different individuals in order to improve efficiency.

Knowledge

Knowledge is the understanding, awareness, or familiarity gained through education or experience regarding facts, skills, or objects.

Cultural Groups

Groups categorized based on shared characteristics such as ethnicity, language, traditions, and values.