Consider the General Form of the Consumption Function in a Simple

question 41

Multiple Choice

Consider the general form of the consumption function in a simple macro model.Once government and taxes are included in the model,desired consumption can be expressed as ________,where a = autonomous consumption,t = net tax rate,Y = national income, = disposable income,and MPC = marginal propensity to consume.

• A)C = a + MPC(1 - t)
• B)C = a - (1 - t)
• C)C = a + MPC ∙ Y
• D)C = a + MPC ∙ t ∙
• E)C = a + MPC(1 - t)Y

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Definitions:

Voltage Measurement

The process of determining the electrical potential difference between two points in an electric circuit.

Continuity

In electrical systems, the unbroken and complete path for current flow, crucial for the safe and effective operation of circuits.

Diode

A semiconductor device that allows current to flow in one direction only, commonly used for rectification or as a check valve in electrical circuits.

Circuit Resistance

The opposition to the flow of electric current within a circuit, measured in ohms, affecting the circuit's performance and power consumption.