The Ratio of the Change in Consumption to the Change

question 168

Multiple Choice

The ratio of the change in consumption to the change in disposable income is called the

• A) marginal utility of consumption.
• B) average utility of consumption.
• C) marginal propensity to consume.
• D) average propensity to consume.

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Definitions:

Rolls Forward

A process in accounting or financial planning where data or balances are brought forward from a previous period to the current one.

Manufacturing Overhead Budget

A detailed plan showing the production costs, other than direct materials and direct labor, that will be incurred over a specified time period.

Non-cash Charges

Expenses reported on the income statement that do not involve a direct cash outflow, such as depreciation or amortization.

Direct Materials Budget

A financial plan that estimates the cost of raw materials required for production.