Which of the Following Is True of the Relationship Between

question 100

Multiple Choice

Which of the following is true of the relationship between disposable income and consumption?

• A)Disposable income and consumption are both dependent variables.
• B)Disposable income and consumption are both independent variables.
• C)Disposable income is the dependent variable and consumption is the independent variable.
• D)Consumption is the dependent variable and disposable income is the independent variable.
• E)Neither is dependent nor independent since they are related by the equation DI = C + S.

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Definitions:

Economy

The system by which goods and services are produced, distributed, and consumed within a particular country or area.

Inflation

Inflation is the rate at which the general level of prices for goods and services is rising, leading to a decrease in the purchasing power of money.

Labor Force Participation Rate

The percentage of the total working-age population that is active in the labor market, either employed or actively seeking employment.

Adults

Individuals who have reached a specific age or maturity level, generally considered to be the age at which they can assume legal rights and responsibilities.