The Figure Given Below Represents the Consumption Function of a Country

question 119

Multiple Choice

The figure given below represents the consumption function of a country.
Figure 9.3

-Refer to Figure 9.3. We can infer that the marginal propensity to save would be _____.

• A) 0.7
• B) 0.1
• C) 0.4
• D) 0.25
• E) 0.5

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Definitions:

X-inefficiency

The difference between efficient behavior of businesses assumed or required by economic theory and their observed behavior in practice, often due to a lack of competitive pressure.

Tight Supply Conditions

A market situation where the supply of a good is limited, often leading to higher prices.

Nonrivalrous Consumption

A consumption characteristic where one individual's use of a good does not reduce availability to others.

Marginal Cost

The cost incurred by producing one additional unit of a good or service.