Induced Consumption Spending

question 7

Multiple Choice

Induced consumption spending

• A)represents consumption that is independent of income
• B)plus saving equals total consumption spending
• C)is positively related to disposable income
• D)is equal to autonomous consumption spending in equilibrium
• E)is the difference between autonomous consumption spending and disposable income

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Definitions:

Average Cost

A calculation used in finance and economics that divides the total cost of production by the number of goods produced, yielding the cost per unit.

Perpetual Inventory System

An accounting method that records inventory updates continuously as sales and purchases occur.

FIFO

"First In, First Out," an inventory valuation method where goods first added to inventory are the first sold, used to determine the cost of goods sold and remaining inventory.

Ending Inventory

Ending Inventory is the total value of all inventory, including raw materials, work-in-process, and finished goods, that a company has at the end of an accounting period.