If Every Time Disposable Income Increases by $5 Billion,consumption Increases

question 85

Multiple Choice

If every time disposable income increases by $5 billion,consumption increases by $4 billion and saving increases by $1 billion,the MPC and MPS are,respectively,

• A)1/4,1/2
• B)1/2,1/2
• C)1,0
• D)4/5,1/5
• E)the answer is indeterminate from the information given

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Definitions:

Specializes

Specialization involves focusing on a narrow area of knowledge or skill, often to improve efficiency or performance.

Terms Of Trade

The ratio at which a country can trade its exports for imports from other countries; reflects the relative prices of a country's export and import products.

Production Possibilities

The different combinations of goods and services that an economy can produce efficiently with given resources and technology.

Limits

Concepts in mathematics and economics referring to the value that a function or sequence "approaches" as the input or index approaches some value.