The Benefit to Some Consumer of the Last Unit of a Good

question 78

Multiple Choice

The benefit to some consumer of the last unit of a good consumed is

• A)represented by the height of the supply curve at that quantity
• B)negative if the producer is suffering economic loss
• C)decreases at an increasing rate in a competitive product market
• D)is zero
• E)represented by the height of the demand curve at that quantity

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Definitions:

Saving

The portion of income that is not spent on consumption but instead is set aside for future use or investment.

Disposable Income

Income left for households to direct into savings and spending after deductions of income taxes.

APC

APC, or Average Propensity to Consume, is the ratio of total consumption to total disposable income, indicating how much income is spent.

Induced Consumption

The portion of consumer spending that changes in response to changes in disposable income.