If the Marginal Propensity to Consume Is 0

question 232

Multiple Choice

If the marginal propensity to consume is 0.75, the marginal propensity to save is

• A)0.25.
• B)0.5.
• C)0.75.
• D)1.
• E)3.

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Definitions:

Distributor

An intermediary entity in the supply chain that buys products from manufacturers or wholesalers and sells them to retailers or direct to consumers.

Lot Sizing Decisions

The process of determining the optimal order quantity that minimizes total inventory costs, including ordering, holding, and stockout costs.

Fixed Costs

Expenses that do not change in the short term, regardless of the level of production or sales activities, such as rent, salaries, and insurance.

Quantity Discounts

Reductions in price per unit based on the amount of goods purchased, used as an incentive for buyers to purchase larger quantities.