INSTRUCTIONS: Choose the Word or Phrase in [ ] Which

question 81

Multiple Choice

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select
-The short-term goals you put into your financial plan [will | will not] affect the achievement of long-term goals.

• A)for the first item
• B)for the second item
• C)if neither item will correctly complete the statement.

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Definitions:

MPS

The marginal propensity to save refers to the portion of each additional dollar of income that is set aside for savings instead of being spent.

Induced Consumption

Consumer spending that increases when income increases and decreases when income decreases.

Autonomous Consumption

Consumer spending that does not change in response to fluctuations in income, reflecting basic, non-discretionary expenditures.

Disposable Income

The funds set aside by households for spending and saving after income tax subtractions.