If the Marginal Propensity to Consume (MPC) Is 0

question 96

Multiple Choice

If the marginal propensity to consume (MPC) is 0.60, what is the spending multiplier?

• A) 0.4.
• B) 0.6.
• C) 2.5.
• D) 6.0.

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Definitions:

Vitality Index

A metric used to assess the innovation of a company by measuring the percentage of revenue from new products compared to its total revenue.

Promotional Dollars

Funds allocated by a company or brand for marketing activities aimed at promoting their products or services to increase consumer engagement and sales.

Marketing Mix

A combination of factors that can be controlled by a company to influence consumers to purchase its products, typically categorized as product, price, place, and promotion.

Not-Invented-Here Problem

A tendency within organizations to reject or not use products, research, or knowledge because they originate from outside the organization, often leading to a reinvention of the wheel or missed opportunities.