A Marginal Propensity to Consume of 0

question 135

Multiple Choice

A marginal propensity to consume of 0.84 results in a multiplier of

• A)6.25.
• B)1.19.
• C)0.16.
• D)0.84.
• E)1.84.

Understand the concept of period costs and their treatment in financial reporting.

Recognize the role of the income statement in forecasting future cash flows.

Comprehend the matching principle and its application in expense recognition.

Understand the treatment of gains and losses and special items in continuing operations.