Absorption Can Be Defined as

question 58

Multiple Choice

Absorption can be defined as

• A) C + I + G.
• B) I/GDP.
• C) X - M.
• D) GDP/NX.
• E) the quantity of foreign produced goods absorbed through domestic spending.

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Definitions:

APC

The average propensity to consume, which is the proportion of income that is spent on consumption rather than saved.

Disposable Income

Financial allocations for households' spending and saving activities post-income tax deductions.

Savings

Funds that are set aside for future use rather than being spent immediately, often placed in accounts that earn interest.

Consumption

The use of goods and services by households or individuals, typically referring to the final use that directly satisfies human needs or wants.