Narrbegin Exhibit A1.4 Straight Line Narrend

question 10

Multiple Choice

Narrbegin Exhibit A1.4 Straight line Narrend
-In Exhibit A1.4, the slope of straight line CD is:

• A) positive.
• B) zero.
• C) negative.
• D) variable.

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Definitions:

APC

Average Propensity to Consume, which is the fraction of income that is consumed rather than saved.

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.