(Advanced Analysis)Answer the Question on the Basis of the Following

question 65

Multiple Choice

(Advanced analysis) Answer the question on the basis of the following consumption schedule: C = 20 + .9Y,where C is consumption and Y is disposable income. Refer to the given data.The MPC is:

• A) .45.
• B) .20.
• C) .50.
• D) .90.

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Definitions:

Plan Asset Value

The market value of assets that are held within a pension or retirement plan.

Discount Rate

The interest rate used in discounted cash flow analysis to determine the present value of future cash flows or in determining the interest rate charged to financial institutions for loans from the Federal Reserve.

Pension Plans

Financial programs established by employers to provide retirement income to employees.

Current Accounting Standards

The latest guidelines and principles established by regulatory bodies for the preparation and presentation of financial statements.