Exhibit 9-9 -The Smaller the Marginal Propensity to Save,other Things Constant

question 23

Multiple Choice

Exhibit 9-9
-The smaller the marginal propensity to save,other things constant,

• A)the smaller the marginal propensity to consume
• B)the smaller the multiplier
• C)the flatter the consumption function
• D)the flatter the saving function
• E)the steeper the saving function

---

Definitions:

Cash for Clunkers

A government program intended to stimulate the economy and encourage the purchase of new vehicles by offering financial incentives for trading in older, less-efficient cars.

Bullwhip Effect

A phenomenon in supply chains where small variations in demand at the retail level cause progressively larger fluctuations in demand at the wholesale, distributor, and manufacturer levels.

Cash for Clunkers

A government program designed to stimulate the economy and improve the environment by incentivizing the trade-in of older, less fuel-efficient vehicles for newer, more efficient ones.

Bullwhip Effect

A phenomenon where small fluctuations in demand at the retail level significantly amplify as they move back through the supply chain towards manufacturers.