The Positive Slope of the Consumption Function Indicates That

question 296

Multiple Choice

The positive slope of the consumption function indicates that

• A) consumers spend less out of each extra dollar of income.
• B) the amount of household wealth is subject to change.
• C) when prices fall consumers spend more.
• D) consumers increase their total consumption expenditure when disposable income increases.

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Definitions:

10th Percentile

A value below which 10 percent of the data falls.

Measurements

The act or process of determining the size, length, or amount of something typically using standard units.

Outlier

An observation in a data set that is distant from other observations, potentially indicating a variance issue, measurement error, or novel discovery.

Box and Whisker Plot

A graphical representation of data that shows the distribution of data points based on a five-number summary: minimum, first quartile, median, third quartile, and maximum.