If the Consumption Function Is C = 50

question 38

Multiple Choice

If the consumption function is C = 50 + .60 (disposable income) , what is the expenditure multiplier for the full potential expenditure multiplier effect?

• A) 8.33
• B) 1.67
• C) 50
• D) 2.5

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Definitions:

Absolute Value Inequality

A mathematical statement that expresses the range of values an absolute value expression can take and still satisfy a given inequality.

Real Numbers

Any value that represents a quantity along a continuous line, including all rational and irrational numbers.

Set Notation

A method for specifying a set or collection of objects or numbers using brackets and symbols.

Absolute Value Inequality

An inequality that involves the absolute value of a variable expression, used to describe a range of solutions.