The "Marginal Propensity to Consume" Refers to the Additional

question 122

Multiple Choice

The "marginal propensity to consume" refers to the additional

• A)desired saving that occurs out of an additional dollar of disposable income.
• B)desired consumption that occurs out of an additional dollar of disposable income.
• C)desired consumption that occurs out of an additional dollar of investment.
• D)desired consumption caused by a change in tastes.
• E)desired consumption that occurs over time.

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Definitions:

Fixed Assets

Long-term tangible assets used in the operation of a business and not expected to be converted to cash in the upcoming fiscal year.

Days' Sales In Inventory

An indicator that reflects the average number of days a company requires to convert its inventory into sales.

Inventory Ratio

A financial metric that indicates how many times a company's inventory is sold and then replaced over a specific period.

Inventory Turnover

A ratio showing how many times a company's inventory is sold and replaced over a specific period, indicating efficiency in managing stock.