Scenario 11-1 The Information Below Is Relevant to the Following Question(s)

question 108

Multiple Choice

Scenario 11-1
The information below is relevant to the following question(s) .
Assume IBM decides,despite an ongoing recession,to build a new branch for computer analysis in Bozeman,Montana.The plant expects to spend $12 million to hire the necessary employees,all of whom move in from out of state to take the jobs.
-Refer to Scenario 11-1.If the marginal propensity to consume of the newly-employed workers was 3/4,what would be the total change in income that would result from the operation of the plant for one year?

• A)$12 million
• B)$48 million
• C)$9 million
• D)$27 million

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Definitions:

Situational Influences

External factors that can affect consumer behavior, such as physical environment, social situation, time, and purpose of the purchase.

Time of Day

Refers to specific moments within a 24-hour period, often considered in planning and scheduling activities.

Physical Surroundings

The tangible aspects of the environment in which businesses operate or products are used, affecting consumers' perceptions and behaviors.

Low-involvement Offering

Products or services that require minimal thought and effort from the consumer before purchase due to their low cost or risk.