That Part of Disposable Income Not Spent on Consumption Is

question 18

Multiple Choice

That part of disposable income not spent on consumption is defined as:

• A) transitory disposable income.
• B) permanent disposable income.
• C) saving.
• D) autonomous consumption.

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Definitions:

Indirect Method

A cash flow statement approach that adjusts net income for changes in non-cash accounts to calculate cash from operating activities.

Operating Activities

Activities directly related to the operation of the business, including cash flows from operations, investing, and financial activities.

Direct Method

A cash flow statement preparation approach that shows the specific cash inflows and outflows associated with the operating activities.

Cash Received

The actual cash gathered by a company from its various activities, including sales, financing, or investing, during a particular period.