An Increase in the Marginal Propensity to Save from

question 7

Multiple Choice

An increase in the marginal propensity to save from .3 to .4 will cause

• A)the ZZ line to become steeper and a given change in autonomous consumption (c₀)to have a smaller effect on output.
• B)the ZZ line to become steeper and a given change in autonomous consumption (c₀)to have a larger effect on output.
• C)the ZZ line to become flatter and a given change in autonomous consumption (c₀))to have a smaller effect on output.
• D)the ZZ line to become flatter and a given change in autonomous consumption (c₀)to have a larger effect on output.

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Definitions:

Social Loafing

The situation where people working in a team contribute less effort towards a goal compared to when they work by themselves.

Social Facilitation

The tendency for people to perform differently when in the presence of others than when alone, typically improving on simple tasks.

Deindividuation

A psychological state characterized by lowered self-awareness and diminished responsibility, often occurring in group settings that lead to disinhibited behavior.

Cultural Diversity

The presence of multiple cultural or ethnic groups within a society.