-How Much Is the Average Propensity to Save When Disposable

question 181

Multiple Choice

$$\begin{array} { c c } \text { Disposable Income } & \text { Consumption } \\0 & \$ 200 \text { billion } \\\$ 200 \text { billion } & 300 \text { billion } \\400 \text { billion } & 400 \text { billion } \\600 \text { billion } & 500 \text { billion } \\800 \text { billion } & 600 \text { billion }\end{array}$$
-How much is the average propensity to save when disposable income is $400 billion?

• A)0
• B).25
• C).50
• D).75
• E)1.0

---

Definitions:

Developing Countries

Many countries of Africa, Asia, and Latin America that are characterized by lack of capital goods, use of nonadvanced technologies, low literacy rates, high unemployment, relatively rapid population growth, and labor forces heavily committed to agriculture.

High-Income

Relating to individuals, households, or countries with significantly higher earnings or GDP per capita compared to the average.

World Bank

A worldwide financial entity providing lending and grants to underdeveloped countries' governments for capital project development.

Real Output

The total value of all goods and services produced in an economy, adjusted for inflation, reflecting the actual productivity.