Which One of the Following Will Lead to an Increase

question 143

Multiple Choice

Which one of the following will lead to an increase in the slope of the AE function?

• A)an increase in the marginal propensity to import
• B)an increase in the marginal tax rate
• C)a decrease in the marginal propensity to consume
• D)a decrease in the marginal propensity to save
• E)an increase in the marginal propensity to save

---

Definitions:

Air Pollution

The presence of toxic chemicals or compounds in the air, at levels that pose a health risk to humans and the environment.

Mixed Economy

A mixed economy that integrates both private sector and government involvement.

Government Failure

The occurrence when government actions lead to outcomes that are inefficient or not beneficial to society, contrary to its intended outcomes.

Market Failure

A situation in which the allocation of goods and services by a free market is not efficient, often leading to a welfare loss.