The Marginal Propensity to Consume Is Defined as

question 161

Multiple Choice

The marginal propensity to consume is defined as

• A)consumption divided by disposable income.
• B)disposable income divided by consumption.
• C)the change in consumption divided by the change in disposable income.
• D)the change in disposable income divided by the change in consumption.

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Definitions:

Direct Materials

Raw materials that can be directly traced to the manufacturing process of a product and are a significant part of its cost.

Secondary Materials

Materials used in the production process that are not the primary raw materials.

General Materials

Basic supplies and resources used in the everyday operations of a business, not directly tied to the production of specific goods.

Factory Overhead

Costs associated with the operation of a manufacturing plant that are not directly tied to individual products, such as maintenance.