If Consumption Expenditure for a Household Increases from $300 to $500

question 26

Multiple Choice

If consumption expenditure for a household increases from $300 to $500 when disposable income increases from $200 to $500, the marginal propensity to consume is

• A)equal to 1.
• B)equal to 0.75.
• C)equal to 1.33.
• D)negative.
• E)equal to 0.67.

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Definitions:

Environmentally Safe Material

Materials that are not harmful to the environment, often characterized by being recyclable, biodegradable, or non-toxic.

Payoff Table

A tabular representation of the outcomes or payoffs from different decisions or strategies under various states of nature.

Expected Opportunity Loss

The anticipated amount of loss associated with not choosing the best course of action.

Environmentally Safe Material

Substances or materials that do not harm the environment, including during their production, use, and disposal.